Questions tagged [currency]
a generally accepted form of money, including coins and paper notes , which is issued by a government and circulated within an economy.
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How would Greece "temporarily" leave the Eurozone?
Amongst the negotiations between Greece and the Eurozone leaders, there currently exists the possibility of Greece leaving the Eurozone for five years.
Does this imply Greece would have to use a ...
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Currency conversion and Purchase Power Data
Where can I find multipliers to convert a certain amount in a currency, say USD of 1960 to say present EUR taking account of purchase power parity ?
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The Insane Sultan of Slickcrudistan: Calculating Currency Equilibrium
I work for a start-up that has encountered an economics problem no one on our team has been able to crack.
A story form and a general form of the problem are below. I believe they are equivalent, but ...
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Why is the Euro a bad idea compared to other currencies?
Many economists, including Nobel laureates Paul Krugman and Joseph Stiglitz, have said that the Euro was a bad idea from the beginning and is a major reason for all the current economic problems. My ...
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Currency substitution after withdrawal from a currency union?
Currency substitution is the situation where a country uses a foreign currency. For example, Montenegro and Kosovo unilaterally use the euro, El Salvador and Panama unilaterally use the dollar. In ...
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Can banks maintain Euro accounts if the country they're in leaves the eurozone?
If a country forcibly leaves the Eurozone, is it possible for banks within this country to maintain existing euro deposits? Or does leaving the eurozone mean those deposits are automatically ...
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Why should Greece destroy their cash euros?
Leading economists in my country (Sweden) recommend and predict that (in the case of default) the Greek government will destroy all the euro bills in the country. Making holes in them and stamp them ...
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How does US (its economy, banks, industry) profit from dollar being the "standard currency"?
How does US (its economy, banks, industry, "finance industry") profit from dollar being the "standard currency"? I am not seeking "ideological" explanations, but explanations of the mechanisms ...
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Fractional reserve banking and the value of someone else's currency
Suppose there are two countries: $A$ and $B$. $A$ is a large, stable, democratic country with its own currency, the dollar. $B$ does not have its own currency. All prices and financial transactions in ...
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How does a bank convert one currency to another?
Say for example I sell ZAR and buy USD. What happens behind the scenes so that the local ZAR bank is able to deposit USD into my account?
Does the bank require some sort of USD cash reserve?
How do ...
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Questions regarding foreign exchange online trading
I am currently studying economics in college and taking course Macroeconomics and International Finance which covers foreign exchange market topic. The class is very crowded since there are more than ...
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Calculating nominal GDP
I would like to understand one detail of how nominal GDP of a country in a given year is calculated. It seems to me that the GDP in each country is first calculated in the national currency and then ...
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Should Finland leave the eurozone?
Finland's economic recovery from the shock of the global financial crisis of 2007–2008 has been very weak. The country has been in recession for the past three years, with GDP expected to expand by ...
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What will happen to the reserves at the Fed?
Banks currently have 2.7 trillion Federal Reserves that they hold at their Federal Reserve account. It's part of the monetary base and these reserves were created when the Fed purchased bonds in their ...
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Effect of Strengthening US Dollar on Commodities
Many commodities are prices in US dollars. If the Dollar strengthens, then commodities (in non-US countries) will become more expensive. From the consumers' (suppliers') point of view, this should be ...
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Why does any treasury / central bank hold gold?
I know the US treasury is slowly selling its gold reserves, but what is the actual mission and purpose when it comes to the holdings?
What is the reasoning behind the slow rate of liquidation? I have ...
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Would a world-wide currency be a good idea? [duplicate]
While every country has it's own political ideals, enforcing laws and rules, in an ever more globalized world, I believe the idea of fragmented economy is limiting big growth opportunities while ...
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Does each stock exchange only trade in one currency?
And if not, how are currency exchange rates accounted for?
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Why are CAD, AUD known as commodity currencies
Why are some currencies like CAD, AUD known as commodity currencies?
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What are the main differences in a macroeconomic model, i.e. New-Keynesian DSGE, under a currency substitution (full dollarization) scheme?
I have searched arround the web and economic journals trying to find out research related to a macroeconomic model in which the country is fully dollarized, but I haven't had any luck. My main concern ...
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What is the relationship between S&P500 and the US dollar
In the recent past, both the S&P 500 and the USD (against other currencies) have appreciated a lot.
From what I understand, if USD goes up against other companies, the major companies of the S&...
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What is the difference between currency manipulation, and a fixed exchange rate regime?
China is labelled by some to be a 'currency manipulator', that is supposedly pegged to the US Dollar. What is the difference between currency manipulation and a fixed regime?
Different motives?
I ...
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what alternatives can possibly back a new currency
A currency can be backed by a trusted issuing authority, by a scarce resource or by the scarcity of its money base (eg bitcoin). Are there any other known working alternatives.
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How can the Swiss exchange rate be very biased in a free market?
In 2002, when Germany, France, Italy and Austria adopted the Euro currency, the exchange rate with Switzerland was 1.60 CHF (Swiss Franc) = 1€ (Euro).
The prices and salaries in Switzerland were ...
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How to determine the worth of a good
I've searched around the web for awhile now and I'm beginning to think this might be an unanswerable question. I want to know if there is a theoretical way to determine the worth of a particular good, ...
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What would happen if the world switched to a single currency?
What would happen if all countries suddenly stopped using local currencies and adopted a global currency (like the Euro, but for everyone)?
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why the currency crisis must occur at time t0 when the pegged rate equals the shadow exchange rate [closed]
Explain why the currency crisis must occur at time t0 when the pegged rate equals the shadow exchange rate and not before or after t0.
Suppose the crisis were to occur at a date before and after t0 ...
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What effect would converting the lowest denomination note to a coin be?
In New Zealand our lowest denomination note is a $5 note.
For perspective, a can of coke costs $1.50 - $2.00, a Big Mac costs around $5.
The idea of a $5 coin is on the cards.
The question is - ...
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What are the known / alleged problems against using energy as currency?
What are the known (and alleged) problems of using Joules (i.e. a measure of energy/work) as a currency? I tried to find such idea in Google (searched terms like "technocracy", since someone told me ...
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What effect would removing the lowest denomination currency have?
Here in New Zealand our lowest denomination coin is 10c after the 5c was removed about 10 years ago. I think generally the public is pretty happy about the move.
It's quite a common argument to ...
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How Much Gold Did Weimar Have Pre-Hyperinflation?
A few years ago, Peter Schiff and a few other Austrians (not all Austrians, as Mish was stating the opposite) were adamant about hyperinflation and Paul Krugman stated that it was like talking about ...
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How does a country increases or decreases it currency value (exchange rate) against other nations currency?
I want to know how a country, Mexico for instance, keeps the exchange rate higher or lower against other nations currency, USD, EUR, JPY. How does the value of a nation currency is valued against ...
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What benefits does Bitcoin (i.e. cryptocurrency) offer?
I really, really like moderate inflation. I live in Sweden where the interest rates just went negative because we are on the brink of deflation, and the rate of inflation we have now is far too low. ...
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Australian Dollar Devaluation
I am a layman in economics. I am curious about the current devaluation of Australian Dollar in comparison with the US Dollar. Could someone please explain, in simplest words possible:
What causes ...
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Real time data map about the amount of a currency that are held in the world ?
Where can I see in real time data about the amount of a currency that is held in central banks (and maybe other significant places) ? A map would be great.
I would like to know if there is an ...
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Unlimited supply of national currency?
I was reading this article about Denmark central bank defending its currency peg:
http://www.bloomberg.com/news/2015-01-22/denmark-cuts-key-deposit-rate-to-minus-0-35-to-drive-down-krone.html
In it ...
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Why was Swiss National Bank in red by keeping fix exchange rate to Euro?
When I read news about the action of Swiss National bank of not keeping fix ration to Euro any more, I read in all articles, that it was too expensive for Swiss National Bank to keep the fixed ...
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Market Behavior under expected and unexpected news
I found the following text in the paper "Real-time Price Discovery in Foreign Exchange"
The general pattern is one of very quick exchange rate conditional mean adjustment, characterized by a jump ...
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How could the Euro zone be broken up in an ordered way?
Let’s assume that the members of Euro zone all agreed that it would end in 18 months time with each country getting its own currency.
What process could be put in place to allow this to happen ...
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Benefits of a weak national currency
I often hear that developing economies can benefit from a weak national currency. For example China as exporter deliberately makes its national currency weaker, so that it gains an advantage. Are ...
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When a country adopts the Euro, what happens to its debt?
When a country, say Greece, adopted the Euro as its currency, what happened to the debt that was based on the Drachma? Was it converted into Euros?
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What's the point of adding security features to new bill designs?
What's the point of creating new bills with more security measures to prevent counterfeiting? (For example in the USA the new $100 bills have more security features).
If the old bills are still ...
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How does raising the Russian interest rate defend the Ruble from devaluation?
Raising interest rates to minimize currency devaluation is being adopted in countries like Brazil and Russia:
Brazilian interest rate
Russian interest rate
How does raising the interest rate ...
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What is the advantage and disadvantage to have a high value of USD for USA?
What is the advantage and disadvantage to have a high value of USD for USA?
China and Japan always want to keep their currency low as oppose to USA.
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Why is the rouble collapsing?
What are the reasons why the rouble (RUB) is collapsing? Which one is the main one?
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Currency Values, Developing Economies and Balance of Trade
For a developing economy like India, where balance of trade is negative, is it good to have a weak dollar or a strong dollar?
Dollar value increases (Rupee, the local currency, weakens), imports (...
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Real Exchange Rate vs PPP rate
I'm having troubles to understand the difference between the Real Exchange Rate and the PPP rate.
I know the first one is calculated using a basket of goods and services so that the non-tradeable ...
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Why isn't there an "ideal value" for a given currency? [closed]
If a currency can be worth too little (e.g. needing \$10,000,000,000 to buy a loaf of bread) and worth too much (e.g. being able to buy a loaf of bread for $0.00001), why isn't there an "ideal value" (...
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