Why can the world not use the same currency?

Question

I personnally think that if we have different currencies at this time that there's world wide trade, some countries will become richer and others poorer for there's no equity of resources in all parts of the world.
If you think yes or no, please give me your reasons.
Thanks.

Answer 1

Actually, the reverse is true. Having your own currency (independent of another nation's currency) allows you a great deal of flexibility. It allows your central bank to manage the domestic economy for the benefit of your population.

From a worldwide perspective, inflation is both global and national. Globally, inflation happens slowly. Nationally, inflation can be severe and rapid due to independent variables like wealth, job markets, raw material access, market access, etc.

The ability to handle national problems with your own currency, gives every government a powerful force to control inflation and manage the business cycle.

Take for instance, some of the Eastern European countries that are not a part of the EU, but that unofficially use the Euro as their currency. They have NO control over their own economy because they cannot control the money supply. If the economy booms, they cannot limit inflation and thus boom and bust cycles run rampant.

One of the main problems that the EU has had with the Euro, is that France is facing inflation and needs a tighter money supply, while Germany has a slowing economy and needs a larger money supply. They use the same currency, so who gets what they need? So far the answer has been neither.

Hope this helps,
Good luck!

Answer 2

Another reason that the world has not switched to the same currency is that the countries of the world do not trust each other. If a single currency is used, who gets to regulate it? If you allow every country to print the currency, then some country will cheat, printing more and more in an attempt to get rich. All this will do is cause more money to be in circulation, and weaken the value of the currency and hurt all the other countries that use it.

Giving control of this to some third party would not likely sit well with the United States. Look at how highly we think of organizations such as the UN. We fight them on lots of issues. Imagine giving control of our economy over to them. That wouldn't sit well with a lot of people.

So, while the current system might be a bit confusing with exchange rates and such, it actually is fair to participants, since it bases your wealth on what you do, and not just on how much money you can print up.

Answer 3

Yes, in the near future economists are trying to create global currency which is in the process. Staring Eurocurrency which took effect i 1999, Eurounion are still inviting other nations to join one world one currency. Only of different sizes depending on the gold deposit of that country. Synchronizing the eurocurrency is the World Trade Center which was aborted on 9/11 and maybe on process of rebuilding them.

Answer 4

I think that it would be totally unfair for stronger currencies like the British pound to be be relagated to the same level as poor performing currencies as the ZImbabwe dollar. The British economy has worked hard to get to where it is and other poorer countries need goals to strive toward instead of being handed everything on a silver platter.

Answer 5

Under present state of globalisation the countries does not want to have the same currency due to the following reasons:
- Difference in cost of production of things- presently they are able to compwensate by keeping differential cost;
-Value Addition - The significance of the concept will be lost by keeping single currency;
- Difference in availability of resources: This will lead to inflation and rise in prices in some countries while accumulation of the products in the other ones;
- Significance of Skills: Master skillmen will not be able to sustain their reputation due to difference in input of intelligence;
- Developed vis-a-vis developing and under developed countries- Their present status in the world market will not allow them to accept the preposition;
- Rich Vs poor countries: cost of production and consumption .
Due to these reasons single currency may not be acceptable.

Answer 6

The world will eventually have only one currency.

Answer 7

Politics:

Allows 'soverign' nations.

Allows competititon (Supply & Demand); downside is when countries lie about numbers of the value of their money causing a false supply & demand.

Answer 8

'coz world have many country