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the Tyneside pound


womblemaster
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Yep, these are simply local gift vouchers which have just been given a name designed to create hype. You have to wonder how they are actually going to help local businesses, rather than just make it more awkward and therefore more costly for them to operate. If they are successful businesses could be left with a load of money that they can't actually spend. There's nothing in that article that says that people can convert them back into Sterling and if they can't then this could be a disaster, whereas if they can then what's the point in having them as they would simply be a more awkward way of paying for things. Basically, this is simply a gimmick to try and encourage people to support local businesses, but the fact remains that if people wanted to support local businesses then they already would be. There might be a short-term boost as people see it as a novelty, but very soon that will disappear as people get sick of the hassle of having to convert their money into them beforehand and not being able to spend and they have left outside of the small number of local businesses that accept them. The question remains if you want to support local businesses then why not go and spend real money with them which they can then use anywhere?

 

If you're going to have a local currency that actually works then it would need a minimum of two things: it would need to be fully convertible (ie you can convert it into whatever other currency you like) and it would need to be floating (ie it's value compared to other currencies could rise and fall depending upon demand for products and services valued in it) so that you could value it at a level that would make your products and services competitive with other areas. Without that it's simply a gimmick.

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If you're going to have a local currency that actually works then it would need a minimum of two things: it would need to be fully convertible (ie you can convert it into whatever other currency you like) and it would need to be floating (ie it's value compared to other currencies could rise and fall depending upon demand for products and services valued in it) so that you could value it at a level that would make your products and services competitive with other areas. Without that it's simply a gimmick.

 

I'll print a copy of the above and send it to Mario Draghi.

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If you're going to have a local currency that actually works then it would need a minimum of two things: it would need to be fully convertible (ie you can convert it into whatever other currency you like) and it would need to be floating (ie it's value compared to other currencies could rise and fall depending upon demand for products and services valued in it) so that you could value it at a level that would make your products and services competitive with other areas. Without that it's simply a gimmick.

 

I'll print a copy of the above and send it to Mario Draghi.

 

There's obviously downsides too, as well as there being significant upsides to a strong stable currency, especially when it comes to global-level economies - as you don't need me to tell you. ;)

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If you're going to have a local currency that actually works then it would need a minimum of two things: it would need to be fully convertible (ie you can convert it into whatever other currency you like) and it would need to be floating (ie it's value compared to other currencies could rise and fall depending upon demand for products and services valued in it) so that you could value it at a level that would make your products and services competitive with other areas. Without that it's simply a gimmick.

 

I'll print a copy of the above and send it to Mario Draghi.

 

You probably should since a lot of the depression in the Euro has come because the ECB hasn't allowed the Euro to drop far enough because they're afraid of inflation in Germany. When an economy needs to devalue, like the Greek, Spanish, Portuguese and Irish economies did, then it's either external or internal devaluation. External devaluation means a weakened currency, which would mean that people's living standards drop, but at least in a way that doesn't hurt as much. It's simply transferring money from savers to spenders, which although isn't fair, is relatively harmless. Internal devaluation means decreasing wages so that the economy can regain its competitiveness. This is obviously much more painful because of money illusion and its effects.

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