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GD AT URPERCENTILE : “COMMON GLOBAL CURRENCY"
ONLY DEBABRATA and SENTHIL CLEAR THIS GD .
Sandeep Bansal: Hi Everyone, This is Sandy from Delhi. S/W engineer, 1.5 yrs work ex
Nilanjan: I am from kolkata
Nimesh : Nimesh from Ahemdabad, BCA
Senth_54 : I m Senthil nathan , Doing final yr M.sc(IT) from Chennai
Debabrata : Debabrata Nag, Chemical engineering, kolkata,3 rd year
Namrata agrawal: Namrata from Mumbai, Computer Engineering working at iflex
www.UrPercentile.com: The topic of the GD is "COMMON GLOBAL CURRENCY"
Nilanjan: The concept of the common currency started from Europe. The 12 member of Europian union started the common currency with 12 of its member, and they got a huge advantage in world market.
Senth_54 : Global currency refers to a currency in which the vast majority of international transactions take place and which serves as the world's primary reserve currency. I argue that a single global currency is unworkable given the vastly different national political and economic systems in existence.
Debabrata : A "Common Global Currency" is what the world needs today. It is definitely necessary in order to avoid expensive currency exchanges of different countries that we have at present. Thus it would lower our expenses. Also this would eliminate the risk of failure of a particular currency
A. Jain: I think that the current exchange rate systems do not give sufficient stability to the international finance system. The common global currency is what the peoples of the world need, and it is what they want. For this. The single global currency would be managed by a single international central bank, with a representative governing board; and member countries would be required to abide by agreed-upon fiscal discipline standard
Sandeep Bansal: Lets first identify the impact of a Common Global Currency. A single currency would help in transforming the world into a single market. This can of course boast trade and increase World GDP. it will promote growth. but it is not without any caveats. The present world order is not at all equal and the poor countries would not be able to compete.
Debabrata : But before a common global currency is introduced we firstly require a common global market. A common global market is mandatory....
Nimesh : global currency concept started from Europe but it started a long back in Europe and implemented after merely 50 years by checking all the problems related to it and what they have positive that they have positive relationship with their neighbour countries . In asia it is also think upon but bitter relationship between india-pak , japan-korea might delay the things
Sandeep Bansal: what we should really be looking at regional trade agreements like the ASEAN or the EU. Regional trade agreements are easier to execute as there is common culturee and political consensus is much easier to build
Nilanjan: well bansal ur point is good, but economic condition of different part of world is different, why the developed country will take the risk of global currency
Debabrata : A common global currency would definitely be considered as the first step towards minimising differences in economic conditions throughout the world thus improving the living conditions of the people
Nilanjan: for Euro EU has 12 developed nation, is will not be available for Asia or Africa
Nimesh : world gdp doesn’t matter because country currency to common currency would still be there
Senth_54 : With one currency, you can have only one interest rate. This means that each of the present currency areas cannot choose the interest rate that suits their economy best. If for example India has a boom and Pakistan a depression, this period would be eased if they both could choose the interest rate that best fitted their needs. In this case that would be a relatively high interest rate in India, and a relatively low in Pakistan.
A. Jain: what about export -import..it ll b so easy. With the use of a single global currency, there would be no more need for expensive currency exchanges nor expensive hedges against currency fluctuations. Gone would be currency speculation and the risk of currency failures and balance of payment problems. Such a currency would therefore be more efficient as a means of conveying true value, without consideration of the political winds of the day.
Sandeep Bansal: yes, we can have a look at the failure of WTO where the developed and the developing have not been able to arrive at any agreement. The EU has onm the other hand been a success and more and more countries want to become a part of it
Nimesh : common currency would make trade easier for particular region if think upon south east Asia and allow other countries to transact with ease of common currency
Debabrata : But definitely an immediate leap is not possible......it would require a common currency among the continents first then the whole world......Europe has Euro....so if all others can manage too then we can think of common global currency
Nilanjan: i think at first we have to reconcile the whole worlds economic condition we have to bridge the gap, then only we can think about common currency for the case of Euro there is problem in europe, UK have not accepted it.
Senth_54 : we have already experienced a huge level forgery of Euro dollars in European nations...it would be difficult to track a single currency
Nimesh : common currency between world is merely impossible as we know USA is trading with world merely printing dollars and now they have access to huge oil reserves in Iraq to support rate of dollar against world currencies.
Senth_54 : my main point is...A single currency can only have a single interest rate. However, different regions in the world, with varying rates of economic growth, may require different interest rates.
A Jain: Why cant we have common currency 4 different continents
Nilanjan: in that case Ashu we cant have common global currency , it will be continental currency.
Debabrata : For a common currency it need to be monitored by an International bank with representatives from nations throughout the world....Just like the present United Nations for monitoring peace and harmony we require an international organisation in order to monitor the economic harmony throughout the globe
A Jain: Yes but through union we can …
Nilanjan: which kind of union pls explain?
A. Jain: v can make unions or orgainsations of the continental countries....and then decide
Senth_54 : moreover a single world currency is unnecessary, because the U.S. dollar already provides many of the benefits of a world currency while avoiding some of the costs
www.UrPercentile.com: CAN WE CONSIDER GOLD AS A COMMON GLOBAL CURRENCY TODAY
Debabrata : But there is a consideration about who can participate as members of the international organisation. It depends on economic, political factors....
Nilanjan: we have some problem on gold, its cost is to high, it cant be affordable in day to day transaction
Senth_54 : there is high political factor...there has to be a high level of trust between different countries before a true world currency could be created and world currency would undermine national sovereignty.
Nimesh : being a person from family trading in gold from mere 50 years I would acknowledge that GOLD is a world currency as it can be value on the basis of purity which is same all around the world and there is no contradiction among countries. Common currency is mean for global trade more than day to day trade
A. Jain: but gold is a natural resource which will end some day ..so its just a temporary
Debabrata : Food, gold was one time used as common currency but now it is almost not feasible......if it is then a country with poor gold resources would not have it's economy well distributed throughout the nation thus leading to high economic differences throughout
Nilanjan: so nimesh we cant avoid the fact that currency is used for day to day trade also
Debabrata : Also a country with poor gold resources would get exhausted sooner than one with ample resources....thus they would be of nowhere
Nimesh : Euro movement was started to minimize USA's industrialization impact and at that time Europe was not developed at full now at ASEAN we are talking about common currency but problem like fake currency is worries the most
Nilanjan: gold has also a value of itself how can it be considered as currency, it has another use
Senth_54 : there is a association known as single currency association and it plans to implements single currency by 2025..it faces many political and economical threats...
Nilanjan: fake currency is a problem of administration, its not a fault of currency system
Nimesh : appreciate that gold is rare resource but the fact is that gold was used in past against CRUDE OIL but lately converted against dollar which is why USA currency is dominating and all currency have it rate against dollar
Senth_54 : the whole concept like establishment of BPO's ., outsourcing and many other factors would come to full stop by this single currency concept...
Debabrata : But indirectly in today's world "gold" is the currency.......it is the gold content of a country that provides the value to it's economic currency........and definitely we can see how much differences have been created 1 U.S Dollar= 46 rupees (approx.) .. we can minimise that with a common global currency
Nimesh : we can have common option like china and UAE are controlling their currency rate
A. Jain: As it's thought by many economists that a single global currency will be good for the people of the world and as many economists and non-economists expect a single global currency "someday", why not obtain the benefits thereof sooner rather than later? It will surely benefit all the people of all the countries of the world if there is a single global currency, just as it currently benefits California and Maine to be in the same monetary union with the U.S. dollar, and for Germany and Portugal to be in the European Monetary Union with the euro. "Let's start planning, NOW!"
www.UrPercentile.com: Thanks everyone, request everyone to give a concluding statement .
Senth_54 : All the people agreed to say gold as currency but I and some of my friend thought it would be impossible to implement
A. Jain: Of course, there are issues to be worked and agreements to be made. There will be questions about which countries can participate, and under what conditions. There will be questions about what steps must be accomplished first or second or third. There should be no question, however, of whether the goal should be reached. In any case, "Let's start planning, NOW!"
Nilanjan: well the idea of common currency is good, but in the present economic scenario it is not good to implement, we have to take care of many factors like security, economic balance then we can implement it
Debabrata : We can conclude that "A Common Global Currency" is what the most required today but it's introduction is definitely to face many resistances but still for global economic harmony we require it the most today.
Nimesh : yes it is a good concept for developing south asia countries but it should not be implemented in hurry all the factors should be tested upon primarily.
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