The Euro
The new international currency of the European Economic union, euro became the national currency on January 1 2002. In this union where only euro is valid as currency includes Austria, Belgium, Finland, France, Germany, Greece, Ireland, Italy, Luxemburg, Netherlands, Portugal and Spain and their national currencies will cease to exist. Before the euro formation, there existed the gold standard and the Bretton Woods system. Both were aimed at the internal and external stability. These policies collapsed when the two goals diverged.
Since the euro eliminates the exchange rate problem and focuses more on the internal stability by unifying currency, the policy target dichotomy can be resolved. Even though nothing like euro has been established before, it was formed to benefit the European economy by controlling the budget deficit, by having a more stable government, and by creating an even closer union among the people of Europe thus there are many benefits that will allow euro to exist in the long run. The formation of euro has increased the importance of internal stability such as price stability and employment.
The Europe’s move to euro must stand on a foundation of stable government policies. The stability will cause lower prices, lower interest and create more jobs and investment. The internal stability should be build from the inside and not pressured from the outside by fixed exchange rates, ”Monetary stability had to be built at home” quoted by Heinz-Peter SpaHn. By uniting Europe the “home” area has expanded. The articles in the Treaty on European Union clarifies that the budget deficit cannot exceed 3% of countries gross domestic product by establishing very clear surveillance procedures. The deficit ...
... middle of paper ...
...sizes and colors and posses identical designs in all 12 countries. This makes it easier for a foreigner to recognize the bank note.
The formation of euro can have two outcomes. It is either the great experiment like the critics says or it will succeed in the future and stabilize the economy by focusing on the internal balance. By increasing trade and reducing trade restrictions Europe will be more integrated. The increase in competition will benefit the growth of the economy. For economy to expand there have to be new innovations. To have new innovations, there have to be experiments in the economy. The introduction of euro is completely new in our economy and it is a great experiment that will succeed and promote the overall economic growth. This is not a short run move. Euro needs time to develop so that the beneficial results should be seen in the long run.
The European Union has been helped economically ever since World War II. Right after World War II’s end, Europe was struggling to hold on. The countries of the modern-day European Union thought it would be a good idea to come together and help each others struggling economy. To this day, this decision has had a very positive outcome on the EU’s economy. As shown in Diagram 1, the European Union combined together has the world’s highest GDP at 18.3 Trillion USD as compared to the United States’ 17.4 Trillion USD GDP and China’s 10.4 Trillion USD GDP. The idea
Around the world, there are many countries that have their own distinct culture, ideas and, invention. At some point, there are one too many things that different countries have borrowed from each other making them similar. However, there are also specific qualities that set them apart from each other. If you take Ethiopia; a country located in East Africa, for example, and compare it with The United States, same as North America, there are many ways we can name their dissimilarities. For one, they are located in different continents so the weather, time zone, and calendar are very different.
In conclusion, the European Union has “merged” the countries of Europe. It has developed a common currency called the Euro’s, and a Parliament located in Belgium, Luxembourg, and France. Also, ALL of the countries of the Union are affected when one country is affected. This is important because the continent of Europe had become very weak after the wars and they needed to strengthen, and the European Union keeps the countries of Europe strong and economically fit.
When the first Europeans settled in what would become the United States, the need of a currency to make trade easier rapidly arose. Before the US Dollar as we know it, the American Colonies went through several currency systems. Since most settlers were from the United Kingdom, the colonies were under the authority of the crown, and used the British system of pounds, shilling and pence. The use of Spanish dollars was also very widespread, and the name of the country’s official currency comes from this common practice. While the first trades took place with British or Spanish currency or commodities, the Massachusetts Bay Colony was the first to issue some paper currency, which it denominated in British terms at first, and then in both British and Spanish terms. For the first time in the colonies, a colonial authority delivered a piece of paper, regardless of the Crown’s opinion, which people trusted would be worth money. This was therefore the first fiat currency of the colonies, which would later become the United States of America. In this paper, we will explore the evolution of fiat currency in the United States, and the process that led to the adoption of the US Dollar still in use today. It will cover the period from 1690 to 1863, separated in three parts that correspond to currency evolution: Colonial currency from 1690 to 1775, the Revolution and the first banks from 1775 to 1860, and finally the US Dollar, the Legal Tender Act and the National Banking Act from 1860 onwards.
Paper money that was issued by the colonial government was a concern. Certain paper money could only be used for paying public debts, including military supplies or taxe...
The place of women in Saudi society is determined by a deeply conservative culture, vindicated by a narrow interpretation of religion, and enforced by law. That place it would appear is at home, subservient to and legally dependant on their male guardian. Saudi society suffers from pervasive segregation along gender lines and women's freedom of movement is impeded, forcing them to rely on male chaperons.
There were other standards of money in different places. There were different clay tokens. People who were not as wealthy as those who paid in silver paid in less valuable metals like copper, tin, and lead, but mostly barley.
Money has evolved with the times and is a reflection of the progress of man. Early money was a physical commodity, grain, gold or silver. During the vital stage, more symbolic forms of money such as certificates of deposit, bank notes, checks, letters of credit, bonds and other forms of negotiable securities came into prominence. Social development transformed money into a trust, “In God We Trust' it says on the back of the ten-dollar bill.” (The Ascent of Money, 27)
The theme of this essay outlines two things. One, the key elements of Bretton woods system and second, the characterisation of Bretton woods system by Ruggie as ‘embedded liberalism’, and how far he succeeds in it. The Bretton woods system is widely referred to the international monetary regime, which prevailed from the end of the World War 2 until the early 1970s. After the end of the World War 2, the need of international monetary framework to boost trade and economic; growth and stability, was important. Taking its name from the site of the 1944 conference, attended by all forty-four allied nations; the Bretton Woods system consisted of four key elements. First, to make a system in which each member nation has to fix or peg his currency exchange rate against the gold or U.S. dollar, as the key currency. Secondly, the free exchange of currencies between countries at the established and fixed exchange rate; plus or minus a one-percent margin. Thirdly, to create an institutional forum, so-called International Monetary Fund (IMF), for the international co-operation on money matters: to set up, stabilize, and watch over exchange rates. Fourth, to remove all the existing exchange controls limiting (protectionism) policies by the members, on the use of its currency for international trade. In practice the first scheme, as well as its later development and final demise, were directly dependent on the preferences and policies of its most powerful member, the United States. According to John Gerard Ruggie, 1982, this Bretton woods system of monetary co-operation represented the type of liberalism which characterise “domestic social economic stability along with a liberal trading order.” He referred this system as ‘embed...
How has the pre-existing gender division of labor and gendered state policies affected Saudi Arabia’s women workers in their demand for equal opportunities and fair treatment? What are some of the factors involved in disempowering migrant workers in host countries and what happens when these workers start asking for their rights?
As a result of those huge economic and social issues resulting from Eurozone crisis, finding a solution to the currency problem become an urgent as well as a crucial task of the member countries. In order to fix this problem, there were many different proposals submitted by all parties concerned. Policy implementations taken by the European Central Bank have had some powerful impacts on the economy of the union, and therefore the idea concerning a separation within the union has almost disappeared. However, to be able to find an effective and permanent solution it is needed to focus on long term fiscal and monetary policies.[1]
This report draws from many publications written over the last twenty years exposing the unique situation in Saudi Arabia, while also utilizing recent headl...
...ll as private sectors have gone international with new ventures outside the country. These companies are generating revenue, though modest compared to their overall sales revenue, by deputing their expert personnel outside.
One of the most integral qualities of an entrepreneur as well as that of a successful business is the degree of innovation it possesses. Innovation refers to the creation of new ideas, improvement of existing production processes, and effective problem solving. Innovation allows for increased efficiency in a business, which in turn increases its supply potential and productive capacity. Being innovative may involve either improving upon old methods o...
There is one thing that differentiates the international business with the domestic business where it uses more than one currency in the commercial transaction. For example, if a company from British purchases some goods from a company from US, the international transaction will require for exchanging pounds and U.S. dollars which involve the foreign exchange market. In the foreign exchange market, any country that wish to do business with foreign country, the country need to convert their domestic currency into the foreign currency that they are wish to cooperate with through foreign exchange.