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Developing countries aren't going to be too happy about this. If a large number of a country's citizens adopt this, it forces that country to lose its independe
by deafcalculus 7y ago
Developing countries aren't going to be too happy about this. If a large number of a country's citizens adopt this, it forces that country to lose its independence over monetary policy. Since Libra is not controlled by the local government, this is not a fixed exchange rate regime, it's effectively dollarization and can have far reaching consequences.
IMHO, the Libra is at the same time too ambitious (in aiming for full capital convertibility across nations) and too timid (in entirely giving up monetary independence). A libra-usd, Libra-euro, libra-inr, etc. which allows countries to retain monetary sovereignty would have been easier for governments to accept. But then, Facebook can't say it's a new currency and circumvent KYC and other local regulations. But who knows? Stranger things have happened. The euro is a currency without a state. Maybe the time has come for denationalizing money.
- halukakin 7y agoIf it were to affect US economy adversely I think FED could chip in and have a say in Libra's direction. But other economies could be hurt by Libra's position. Personally I don't mind the monetary independence of countries. But real people could lose real jobs since their governments don't get a say in Libra's governance.
- mr_toad 7y agoIf countries were printing money under fixed exchange rate regimes their economic policies are a joke anyway, all they’re going to accomplish is inflation. Libra and other digital currencies might make it easier for people to switch away from their local currency, but banning it won’t affect the underlying problems.