Science Forums 2

[Moontanman]

Originally Posted by questor

If trade among countries is to occur, what should be the measure of value? The trade item itself can
have a value depending upon what someone will pay for it, but what is the value of the medium of exchange itself? What sets the value of the Romanian leu for instance? Would you sell your property for this currency? The dollar has been serving the purpose of currency of last resort, but now this is changing. What will become the standard, or store of value that the dozens of world currencies will all accept?

Ok questor I'll bite on this one, since I am almost certainly the most ignorant one here on this subject I'm going to assume you know what you are talking about. What would you suggest? For that matter what do any of you suggest? So far all I read is what not to do, how about a what to do instead? I can see some real problems with the gold standard that have nothing to do with economics, not the least which is the limited supply of gold. At some point the cost of extracting gold from our environment will exceed the value of any gold extracted. What would be better than gold? Wouldn't the rarity of gold cause runaway inflation as the amount became fixed but the value of the world products keep climbing? School me in this. I have a suggestion, probably millions of reason why this would work but how about a standard value of man hours? Say one man hour is worth a certain amount, how many man hours it takes to produce a product would determine it's value and a man hour would be fixed at a certain amount just like an ounce of gold is now. As i said i am ignorant in this subject.