5 ms·
Someone else having control of your currency is a lot different than no one having control over it.
by genwin 13y ago
Someone else having control of your currency is a lot different than no one having control over it.
- hencq 13y agoIt might be different, but it doesn't seem to matter much in practice. But fine, instead of comparing it to Greece, you could compare it to the gold standard. That didn't work so well either.
- the_rosentotter 13y agoSomehow civilizations and empires flourished before modern financial instruments.
- bayesianhorse 13y agoThey actually didn't. Banks have been around for centuries and where instrumental in any economic growth beyond medieval farming methods...
- icebraining 13y agoBut "banks" aren't a currency. They may have issued their own currencies during the gold standard, but then again nothing prevents banks from issuing their own currency in an (absolutely hypothetical) bitcoin standard.
- bayesianhorse 13y agoThe gold standard had to be abandoned because it didn't work. For that matter, a new "Dollar Standard" is popping up, with all sorts of countries using the dollar as legal or quasi-legal tender...
- oleganza 13y ago"Had to be abandoned"? Threat of 10 years in prison in 1933 does not sound like "people decided gold sucks". I guess, government had to take gold by force precisely because people trusted gold more than paper. http://en.wikipedia.org/wiki/File:Executive_Order_6102.jpg http://en.wikipedia.org/wiki/File:Executive_Order_6102.jpg
- hencq 13y agoIsn't that exactly an argument why it had to be abandoned? The government couldn't increase the money supply, because dollars had to be backed by gold.
- icebraining 13y agoWell, some people disagree with the idea that the inability of the government to increase the money supply means the system doesn't work.
- hencq 13y agoFair enough, but I think most economists agree on the problems with a gold standard [1]. This is moving off-topic, but it's interesting that this seems to be one of many topics where there's a rare consensus between economists, but the general public holds a different opinion [2]. 1. http://www.igmchicago.org/igm-economic-experts-panel/poll-results?SurveyID=SV_cw1nNUYOXSAKwrq http://www.igmchicago.org/igm-economic-experts-panel/poll-re... 2. http://www.economist.com/news/finance-and-economics/21569378-if-economists-agree-something-public-will-almost-certainly-think http://www.economist.com/news/finance-and-economics/21569378...
- gamechangr 13y agoI posted this article. This is a little off topic, but I like the links. Karma point to u.
- swalsh 13y agoWhat i'm suggesting is that one solution to some of Greece's issues could have been solved through inflation. Arguably it would have been better received than the measures actually took. However without the control, their options have been pretty limited.
- bayesianhorse 13y agoIt's a simple solution. But it didn't work in the majority of cases. This solution would also require Greece to go back to the economics of a developing country because they can't afford most imports, especially medicine or electronics.
- jljljl 13y agoIt's not just about inflating away debt, it's also about being more competitive vs. other European nations, like Germany. A reasonable devaluing of the Greek currency would have allowed more jobs and opportunities to shift towards Greece, reducing unemployment and probably growing per capita GDP. Greece has other structural problems, but the inability to adjust their currency has definitely hurt them.
- gamechangr 13y agothere is not a "one size fits all" economic plan.
- jljljl 13y agoOf course there isn't. No one is saying there is.
- bayesianhorse 13y agoYou'd have to have a reasonable expectation that the additional competitiveness is worth the cost in living standards. There is no strong evidence that their own currency would help them enough to offset the problems they face after exiting the Euro.