ashtray Posted September 14, 2011 Report Share Posted September 14, 2011 you buy the possession of a currency and not the ownership of a currency for a currency is owned by a central bank and not by you. Now that you have possession of currency, you have the option to sell that currency for some other form of value. It is in the selling process where currency provides a service for you. Currency is assisting in the fulfillment of a transaction, aiding in the trading of values. It is in that perspective where currency has value. Various Currencies with Various Valuations There are numerous currencies in circulation today. The United States dollar, European euro, the Japanese yen and others are only some of the various currencies out there. Though they are all currencies, they vary in value. Some currencies are more valuable than other currencies. If they are all currencies, why do they have varying values? That question that crossed my mine in the early stages of my research regarding currencies. Allow me to introduce to you the factors that give currency value. The two factors that give a currency its value is what I call the quantity factor or money supply and the quantity and quality of goods and services factor. The Two Factors The Quantity Factor The Goods and Services Factor Let me explain what I mean by tackling each factor one by one. In regards to the quantity factor, which can also be known as the money supply factor, the amount of currency available in an economy has a huge influence on the valuation of a currency. The more currency in circulation, the less valuable a currency becomes. When there is too much currency in an economy, the currency undergoes devaluation. This is where Iraq is right now. If there is too little currency circulating in an economy, the currency will undergo revaluation. The quantity of currency available is a major factor. This is why the central bank wants to delete the zeros. so they have less currency. If you had ten dollars and they were worth 10 cents each .. and you wanted to have a dollar with more value .. you could delete one zero and turn those 10 dollars into 1 new dollar with the same value as 10 of your old dollars had . how .. well you have to destroy 9 out of 10 old dollars and make one dollar,, a new more valuable dollar ...do ya think if you did that you would give someone 10 new valuable dollars for 10 old ones ... the answer is ..no.... they are only worth 10 cents each .. you give 10 you get back one new dollar... but the value doesnt change between the 10 old ones and the one new . Both can buy the same thing . iraq is saying they are deleting 3 zeros .. that would mean you get 1000 new dinars for 1 million old ones ...i hope its smoke and they only delete one zero .. second best hope for only 2 zeros .. .. if they delete 2 zeros you would get back $8600.00 for your million dinars .. if they delete 1 zero you would get back $86,000 .... now if they delete and rv at the same time .. say to 4 dollars for one dinar ..your $ 8600.00 is multiplied times four and have a value of $34,400 ....if they delete 1 zero you would end up with $344,000.00 i personlally dont think they have 27 trillion dollars worth of wealth they can come up with to support rving at dollar for dinar .. without a deletion of zeros...or a zero ...but they will reduce the number of dinars into the rv... its simple devision .. and multiplication ... i added a couple things to some things i copied and pasted .. this guy here >>>> is knowledgable>>>>>>>>>>>>>>>>>>>> http://stephansmithfx.com/articles/how-a-strong-currency-affects-an-economy/ <<<< How a Strong Currency Affects an Economy and another >> http://stephansmithfx.com/articles/factors-that-give-currency-value/ <<<Factors That Give Currency Value http://stephansmithfx.com/explanations/money-supply/ <<<<< Money Supply i know .....i know ... iraq is different Link to comment Share on other sites More sharing options...
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