Why is dollar now Rs 60.95 and still getting stronger and stronger? Most Economists say that dollar is still the international currency and reserve currency because of historical reasons. This is not so. The world is too dynamic. Historical reasons dont last more than 1 year. US (and West in general) has least bad court, least bad police and least intimidating administration. So people in US are most productive, most creative and at the same time least indisciplined. Why do they have less bad Govt? The Jury-based and recall-based bottom up approach to keep govt officers in discipline has proved superior than top-down "Commissioners" (or central committees or regulators or Ministers or supreme judges or Lokpals) based approach most countries in East took. Higher productivity has translated into better goods. But using better goods, US created better Military, which is playing important role in maintaining monopoly of dollar. eg Both Saddam and Gaddafi tried to create an alteranative to dollar --- crude as currency. Crude oil as currency is superior than dollar, intrinsically speaking as it cant be created from thin air, its value may change but will change only gradually, and supply/reserves etc are more predictable. But then crude belongs to him, who he has Military. So when Saddam or Gaddafi tried to create alternative to crude, the US Military showed them who is the currency. So yes, productivity is also must --- Military alone wont do. eg USSR had Military, and using Military, it could make Russian Rubble a currency in East Europe from 1950 till 1990. So it did last for 40 years.But because US Military was stronger and US was more productive, it finally lost. ===== Almost all Economists and Political Scientists disregard value of Military. IMO, they are fools or liars. And I think they are liars. They know that they will loose eminence in media and academic world (both of is mostly funded by MNC-owners now) if they were to explain importance of US Military in sustaining importance of US dollar. The MNC-owners do not want the youngsters of India and other countries to understand importance of US Military and Militaries in general. So if Economists talks about Military, they will make sure that he loses eminence in academic world and media. So we have Economists and Political Scientists throwing lies that dollar is important only because of Historical value and Military has no role to play.
Posted on: Wed, 26 Jun 2013 16:39:57 +0000
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