Reserve currency

Fiat money is any legal currency that is not backed by a physical commodity, nor does it require a substantial value for the material. Fiat money is referred to those currency does not use some valuable kind as the currency standard. Fiat money does not represent the actual things and goods. Virtually, all paper money in the world today is fiat money, along with most coin currencies. Next, as same as money, we used today. That the government retains more and a suitable amount of the commodity, which

Government and Economics On April 5, 1933, President Franklin D. Roosevelt signed Executive order 6102, to “prohibit the hoarding of gold coin, gold bullion, and gold certificates.” (Roosevelt, 1933) It required citizens to deliver gold to a Federal Reserve Bank in exchange for cash. Executive Order 6102 was unconstitutional because due process of law was not granted and citizens did not receive just compensation, but it was necessary to save the economy. Executive Order 6102 was unconstitutional because

Abstract: From the perspective of monetary mechanism, this paper explains that the essence of petrodollar system is struggling over the gains to be had from producing the world 's leading currency. Furthermore, taking Euro as an example, this paper pointed out that the potential inflationary pressure to strike the United States financial environment after the collapse of petrodollar system. By maintaining current monetary system and getting rid of tremendous budgetary deficit, this paper also gives

analysts and economists believed that the real trade-weighted value of the renminbi was undervalued by up to 30% to 35%. Companies that produce in China for the overseas market, retailers, and importers clearly benefit from an undervalued Chinese currency, as well as from the abuse of workers’ rights. On the other hand, companies actually producing in the foreign countries – whether for the

countries are trying to play currency wars and trying to keep their currencies devalued, India is trying to prevent depreciation of the currency. (Read our previous report for a review of the situation-

Argentina’s turbulent history of economic crisis are often attributable to government mismanagement and fluctuating commodities prices, which have resulted in the millions to live below the poverty line. Repeated recessions of the 1970s and 1980s, the hyperinflation of 1989-90, the economic crisis of 2001. Argentina is a long way from the turmoil of 2001, but today’s mix of rising prices, wage pressures and the mistrust of the peso have prompted Argentineans to become overrun by a sense of nostalgia

economies were vulnerable to speculative attacks. The Asian Financial Crisis (AFC) started from Thailand, whereby the property and share market started declining and rumours of banks and finance companies caught in financial difficulties led to massive currency attacks stemming from loss of investor confidence. 1.2 Spread of crisis The crisis spread to many neighbouring countries such as Indonesia and Philippines who were believed to have similar unstable economic situations. Although Singapore did not

exchanges rates are determined. MNCs operate in a global market, buying/selling/producing in many different countries. For example, GM sells cars in 150 countries, produces cars in 50 countries, so it has to deal with hundreds of currencies. What are the mechanics of how currency and capital flows internationally? International Monetary System - Institutional framework within which: 1. International payments are made 2. Movements of capital are accommodated 3. Ex-rates are determined An international

takes decision that not to change value of their currency with respect to foreign currency then it is termed as fixed rate. Different variants are available in fixed rate as, 1) Adjustable peg 2) Crawling peg When capital account of any country becomes negative that means more foreign currency is getting out of domestic country. This process increase price of domestic currency against foreign currency which puts pressure on the domestic currency to get depreciates. Since the exchange

Price of one country's currency expressed in terms of another country's currency. D) Amount of currency that can be purchased with 1 ounce of gold. Answer: C Type: Complex Understanding Page: 437 2. An exchange rate is: A) Always fixed. C) The price of one currency in terms of another. B) Tied to the price of gold. D) All of the above. Answer: C Type: Basic Understanding Page: 437 FOREIGN-EXCHANGE MARKETS 3. The U.S. demand for foreign currency