NationStates Jolt Archive

USD - The UN Stable Dollar
Category: Free Trade
Strength: Mild

In the Interest of International Exchange and Banking, and in order to better encourage free trade between the nations of our membership,

The United Nations hereby:

DECLARES the United Nations Stable Dollar (USD) to be the benchmark currency against which all other currencies are to be measured;

NOTES all national currency shall be exchangeable for USDs of equivalent value, as determined by that day’s exchange rate, at any banking or equivalent governmental facility at no penalty;

NOTES FURTHER the USD shall be exchangeable for local currency of equivalent value, as determined by that day’s exchange rate, at any banking or equivalent governmental facility at no penalty.


Go ahead, vote for it. At least it will stop the bickering about balancing everything against the USD.

I love the idea, but I have three comments:

1) Don't call it the dollar, call it the UN Currency Unit (UNCU).

2) Make the UNCU a basket of the currencies of the UN member states (same as the ECU was in RL)

3) This should be significant, not mild. The ability to accurately determine the worth of two currencies is very important. Although, this is the first time I've come across a proposal whose strength is under-rated.

I love the idea, but I have three comments:

1) Don't call it the dollar, call it the UN Currency Unit (UNCU).

2) Make the UNCU a basket of the currencies of the UN member states (same as the ECU was in RL)

3) This should be significant, not mild. The ability to accurately determine the worth of two currencies is very important. Although, this is the first time I've come across a proposal whose strength is under-rated.

Cob.

1) The "USD" already appears all over the place. And many of us are tired of it being the "United States Dollar" even though the United States doesn't exist. Have a look on Thirdgeek - your currency is measured against the "USD". All I'm doing is defining it as a United Nations Stable Dollar so the dissing can stop.

2) No. Game-mechanics already decide what the "USD" is worth, and I'm getting a kick out of working with game mechanics, rather then against them.

3) I don't see it as anything more then mild, but I'm open for discussion, assuming this doesn't hit quorum.

I see your point about USD. Of course, a currency code often has no relation to the name of a country (such as XEU)! How about United Nations Standard Currency Device. It just really pisses off non-Americans to see the word Dollar synonymous with currency.

I think you would really need to define how much a dollar is. A fixed price, such as the price of X grammes of silver/gold at the time that the resolution is passed (at the moment a RL US dollar can buy about 5 grammes of silver)

As for the strength, I still think significant. As I say, knowing the export value of your currency and have a single currency (which is effectively what the last article does, -ish) that can be used would free up trade a hell of a lot.
The ECU and Euro certainly had and has had significant effects on trade in the RL EU

I see your point about USD. Of course, a currency code often has no relation to the name of a country (such as XEU)! How about United Nations Standard Currency Device. It just really pisses off non-Americans to see the word Dollar synonymous with currency.

I think you would really need to define how much a dollar is. A fixed price, such as the price of X grammes of silver/gold at the time that the resolution is passed (at the moment a RL US dollar can buy about 5 grammes of silver)

As for the strength, I still think significant. As I say, knowing the export value of your currency and have a single currency (which is effectively what the last article does, -ish) that can be used would free up trade a hell of a lot.
The ECU and Euro certainly had and has had significant effects on trade in the RL EU

1. Has to fit in the title. And there's nothing inherently objectionable about "Dollar". I could have used "Dinar" or "Dogpoot" for that matter, but "dollar" has a good chance of sucking in USA delegates for familiarity.

2. If I define it, people get all huffy and I get packs of cards thrown. In this way, it's a "standard currency" of paper value, if that. The game already defines it, I see no need to attempt to otherwise define it - and open that can of worms.

3. Meh. If I hear more, I'll raise the strength next time around. Might even telegram people.

How about a compromise? The United Nations Standard Indicator Dollar.
You could use the word 'dollar', the currency code USD, with the added bonus of having a currency symbol formed from the S for Standard and the I for Indicator. The I is to be superimposed over the S, what do you get? a $ sign!

I think there needs to be some definition of the 'price' of the currency. I think something that is equivalent to a RL US Dollar, but isn't an US Dollar as most (after all, RPers would assume a USD is the same price as a dollar), but make sure it remains stable after the resolution passes (i.e. even if the price of whatever raises a lot, a USD remains stable)
It doesn't have to be something as problematic as gold and silver; it could be something mundane like, I don't know, a block of wood a certain size, or something. As long as it's worth an RL dollar, it doesn't matter.
The cost needs to be defined, really

How about a compromise? The United Nations Standard Indicator Dollar.
You could use the word 'dollar', the currency code USD, with the added bonus of having a currency symbol formed from the S for Standard and the I for Indicator. The I is to be superimposed over the S, what do you get? a $ sign!

I think there needs to be some definition of the 'price' of the currency. I think something that is equivalent to a RL US Dollar, but isn't an US Dollar as most (after all, RPers would assume a USD is the same price as a dollar), but make sure it remains stable after the resolution passes (i.e. even if the price of whatever raises a lot, a USD remains stable)
It doesn't have to be something as problematic as gold and silver; it could be something mundane like, I don't know, a block of wood a certain size, or something. As long as it's worth an RL dollar, it doesn't matter.
The cost needs to be defined, really

No, it doesn't.

Consider - my nation has so much oil, we could give it away like water and not run out. We sell to nations to whom oil is more precious then gold. Oil is not a standard.

Vastiva barely has trees. Other nations have forests. Wood is not a standard.

I could go on, but the point is there - particularly when you consider the Future tech nations which can produce gems in mass quantity, gold in rivers, uranium in ton lots.

Best leave it as a standard, undefined, for the game to define as it will - then to bicker and tear it apart and, when all is said and done, have "ILLEGAL - GAME MECHANICS VIOLATION" show up.

I see your point about FT nations. Should have thought of that argument, seeing as I've been using it against Lucius Malfoy II!

I still think it needs to be defined, though. Otherwise, you'd get people claiming that it isn't defined and not supportng it (such as me!)
How about an average worth of all UN currencies? That seems fair.

As for mild/significant. I still think significant. A single UN currency would prevent nations from manipulating there exchange rates to gain an unfair trade advantage; stopping this practice is almost as good as limiting tariffs.

As for mild/significant. I still think significant. A single UN currency would prevent nations from manipulating there exchange rates to gain an unfair trade advantage; stopping this practice is almost as good as limiting tariffs.
Im not that strong in economics, but how would it stop nations from manipulating their exchange rates? The resolution states that the exchange rates can still change and so if a country artificially increases demand for their own currency, shouldnt that increase its value and be manipulating the exchange rate?

Off course I could be horribly wrong.

edit: however it might still be significant, as this is a resolution that might have effect on countries outside the UN. As the currency might/will be a standard for countries outside the UN aswell (as their UN tradepartners use it and probably the currency that will be most used in trade)

Am I to understand that "at no penalty" in the 2nd clause means that commission can't be charged on currency conversions? Because (and please correct me if I'm wrong, as I'm not well-versed in economics), wouldn't that make it even easier to make money by simply buying and selling currencies as they go up and down in relative worth, since there's no longer any disincentive as long as you make all transfers via the USD?

Im not that strong in economics, but how would it stop nations from manipulating their exchange rates?

Because this resolution allows the purchase of products in USD. Because they would have to sell in USD as well, and every country would be able to convert to USD, it would mean, effectively, a single currency for international trade.

Then again I could be wrong (OoC: I did economics at uni, but that was a long time ago, so It's obsolete and mostly forgotten!)

EDIT: Myopia has an excellent point. Perhaps a fixed commision could be included (5%?)

Im not that strong in economics, but how would it stop nations from manipulating their exchange rates?

Because this resolution allows the purchase of products in USD. Because they would have to sell in USD as well, and every country would be able to convert to USD, it would mean, effectively, a single currency for international trade.
Probably misinterpreting manipulating I guess. However the exchange rate will still move just as freely as it does now. So I would assume its still possible to keep your own currency low (or high). Which would mean that you can manipulate the price of your countries products on the international market (as they pay their citizens in their own currency).

Actually, I think you may be right. Oh, well, it would certainly limit manipulation, and I still think it would be significant.

I see your point about FT nations. Should have thought of that argument, seeing as I've been using it against Lucius Malfoy II!

I still think it needs to be defined, though. Otherwise, you'd get people claiming that it isn't defined and not supportng it (such as me!)
How about an average worth of all UN currencies? That seems fair.

READ MY LIPS - WHAT YOU ARE PROPOSING IS A "GAME MECHANICS VIOLATION". THOSE ARE "BAD".



As for mild/significant. I still think significant. A single UN currency would prevent nations from manipulating there exchange rates to gain an unfair trade advantage; stopping this practice is almost as good as limiting tariffs.

I could see that.

Am I to understand that "at no penalty" in the 2nd clause means that commission can't be charged on currency conversions? Because (and please correct me if I'm wrong, as I'm not well-versed in economics), wouldn't that make it even easier to make money by simply buying and selling currencies as they go up and down in relative worth, since there's no longer any disincentive as long as you make all transfers via the USD?

What you are suggesting is Arbitrage - and no, it would not make it easier to make money.

There's also nothing preventing you from taxing those engaged in arbitrage, you simply can't have an "exchange fee" attached to changing money. This is how Free Trade is encouraged.

Im not that strong in economics, but how would it stop nations from manipulating their exchange rates? The resolution states that the exchange rates can still change and so if a country artificially increases demand for their own currency, shouldnt that increase its value and be manipulating the exchange rate?

Off course I could be horribly wrong.

edit: however it might still be significant, as this is a resolution that might have effect on countries outside the UN. As the currency might/will be a standard for countries outside the UN aswell (as their UN tradepartners use it and probably the currency that will be most used in trade)

Tell you what - you go to thirdgeek and manipulate your exchange rate. And good luck with that.

Your exchange rate is dependant on your countries economic ability. If you set an artificial standard, this will not aid you in arbitrage - countries try this all the time, but the "real" exchange rate clobbers them. Consider Russian Rubles.

READ MY LIPS - WHAT YOU ARE PROPOSING IS A "GAME MECHANICS VIOLATION". THOSE ARE "BAD".

Why? I assumed that Third Geek and NSEconomy were independent of the game.
Plus, I'd imagine that if you did work out the average worth it would be $1. I assumed that's how they worked out the exchange rates

:headbang:

I'd swear this isn't hard. All I'm doing is making the standard currency attached to the UN while keeping it called "dollar". That's about it. It removes the "Real World" reference from USD. In doing so, a neutral currency is created.

Stop figuring what it's worth. It's worth what it's worth on the exchange. If people get rich on it, whoopie. It makes a neutral center to work against, which creates trade.

I'd swear people here are overaddicted to overcomplicating everything.

But as it stands, the (proposed) USD isn't worth anything.

If you are so worried about problems with Thirdgeek et al., just set up a (mythical) commitee to set the current exchange rates with the USD.

If you include something like this, change USD to stand for United Nation Standard Currency Indicator Device AKA Dollar, USD or $, added the ability to charge commision, and changed it to significant, you might even get me to help on a telegram campaign.

Your exchange rate is dependant on your countries economic ability. If you set an artificial standard, this will not aid you in arbitrage - countries try this all the time, but the "real" exchange rate clobbers them. Consider Russian Rubles.
it is dependent, it is just not soley based on it. The russian ruble is worth nothing, because the Russian (political and economical) future is so uncertain. However countries can influence how much their currency is worth, by lowering or increasing interest rates and by buying/selling their own currency on the market.

Also if it is soley based on economic ability, why is the english pound worth more than the US dollar as I am pretty sure the UK's economy will never be stronger than the US one.

Also if it is soley based on economic ability, why is the english pound worth more than the US dollar as I am pretty sure the UK's economy will never be stronger than the US one.

I think the difference between RL and NS. In NS, it is just a countries economic ability.

However, just because something like that doesn't exist on NS, doesn't mean it shouldn't be included. There are a lot of things that have been passed in previous resolutions that don't actually exist in NS, but it doesn't mean they should be ignored.

But as it stands, the (proposed) USD isn't worth anything.

If you are so worried about problems with Thirdgeek et al., just set up a (mythical) commitee to set the current exchange rates with the USD.

If you include something like this, change USD to stand for United Nation Standard Currency Indicator Device AKA Dollar, USD or $, added the ability to charge commision, and changed it to significant, you might even get me to help on a telegram campaign.

No more committees! Gah!

And why commission? Why are you hung up on commission? Tax whomever is making money on it, leave the businesses their ability to change currency - and tourists and whatnot - and you get more free trade. Sheesh!

I like United Nations Stable Dollar. "Device" sounds like a machine, and if you go too long, the acronym doesn't work. Simple.

Mythical Commitees are allowed, now.

Also, taxation only goes to a national government. Without the ability to add commision, no bank would exchange currency; they have to make a profit.
You can put in a maximum commsion rate, but commsion needs to be aloud.

Sheesh, stop trying to protect this flawed baby of yours! You should have posted it here before submitting, then we could have ironed out all the creases and problems.

But as it stands, the (proposed) USD isn't worth anything.


Economics 101 - ALL money isn't worth anything. It's based on promises and the perceived ability of that nation to live up to those promises.



it is dependent, it is just not soley based on it. The russian ruble is worth nothing, because the Russian (political and economical) future is so uncertain. However countries can influence how much their currency is worth, by lowering or increasing interest rates and by buying/selling their own currency on the market.

Supply and demand is part of it - but not all of it. The Russian ruble will be worthless until someone decides it has worth. If DLE landed in Russia and said they would trade only with Russia, rubles would be the most prized currency in the world - even if DLE only traded oxygen.


Also if it is soley based on economic ability, why is the english pound worth more than the US dollar as I am pretty sure the UK's economy will never be stronger than the US one.

Because of currency manipulation - which is possible with the relatively small number of powerful nations in RLEarth, but impossible with the huge number of very powerful nations in NSEarth.

Mythical Commitees are allowed, now.

I don't care, I hate them with a passion.



Also, taxation only goes to a national government. Without the ability to add commision, no bank would exchange currency; they have to make a profit.
You can put in a maximum commsion rate, but commsion needs to be aloud.

That's sheer silly. Foremost, banks make money because the government allows them to loan out more then they put in. You're only looking at first tier profit, when you should be looking at third.

When you put $1 in a bank, do you think they can only loan $1? No - they can loan out $10 for each $1 on deposit. Then they charge interest on the loans - that's how banks make money. Most of the rest of the schtick is window dressing.

If a bank is converting currency, that means more spending. More spending, more to tax - and more money will be put into the bank, meaning they can loan more, which means they'll be making more money. This is akin to an arcade changing your ten dollar bill into forty quarters - so you'll spend them in that arcade.

Third tier, not first. Economics 101.



Sheesh, stop trying to protect this flawed baby of yours! You should have posted it here before submitting, then we could have ironed out all the creases and problems.

If you don't like it, do stop posting. Thank you.

I understand how banks make money, I have an economics degree (although profit teering is business studies). However, banks don't do anything for free that they can charge for. If they can't make any money, and could possibly loose money, from currency exchange, the they wont exchange currency. Why do you think banks charge for telephone banking, despite the fact that improving the use of telephone banking would increase third tier profits (decreasing reliance on branches reduces cost, and easier access to bank services increases profit)
Plus, you fail to acknowledge the existance of independent bureau de changes; prohibiting them from charging interest would lead to them shutting down (as converting Pounds to USD then back to dollars would give them no profit), decreasing competition and leading to an increase in prices.

If you don't like it, do stop posting. Thank you.
I'm posting because its a damn good idea, but as written you have a worthless currency and are, effectively, forcing certain small businesses to shut down.

I understand how banks make money, I have an economics degree (although profit teering is business studies). However, banks don't do anything for free that they can charge for.

:rolleyes: Gee, doesn't the resolution say they can't charge for it? Duh.



If they can't make any money, and could possibly loose money, from currency exchange, the they wont exchange currency.

You do understand "increased business = increased profits" right?
And I assume from your "I have a degree in this" you do understand how arbitrage works, over the long term based on production.

So, why the comment again? :rolleyes:



Why do you think banks charge for telephone banking, despite the fact that improving the use of telephone banking would increase third tier profits (decreasing reliance on branches reduces cost, and easier access to bank services increases profit)

:rolleyes: You assume intelligence > Greed, which has never been the case. It also kills the small depositers ability to use it.

My, I seem to have stated explicitly they can't charge for this.

Next question?



Plus, you fail to acknowledge the existance of independent bureau de changes; prohibiting them from charging interest would lead to them shutting down (as converting Pounds to USD then back to dollars would give them no profit), decreasing competition and leading to an increase in prices.

Who cares? I don't support buggy whip makers either. Next?



If you don't like it, do stop posting. Thank you.
I'm posting because its a damn good idea, but as written you have a worthless currency and are, effectively, forcing certain small businesses to shut down.

All currency in and of itself is worthless - you do understand enough economics to know that any unbacked currency is worthless in and of itself, right? Good.

You do understand I don't give a rats ass about moneychangers? Good.

You do understand that creating a "medium" currency, you increase trade across the board? Good.

You do understand that this has a nil effect on arbitrage, on taxation, and such? Good.

Next?

I was making suggestions for inclusions in a subsequent proposal of with the same basic intention, should this one fail.

All currency in and of itself is worthless - you do understand enough economics to know that any unbacked currency is worthless in and of itself, right? Good.

You do understand I don't give a rats ass about moneychangers? Good.

You do understand that creating a "medium" currency, you increase trade across the board? Good.

You do understand that this has a nil effect on arbitrage, on taxation, and such? Good.

So your saying I should ignore the failings of the proposal, and the consequences of such failings, and just statwank?
It'll never happen

EDIT: This is turning into a flame war.
As I say, I do fully and totally agree with the concept of the proposal, however, as it is, there are problems.
If you don't want to re-write it, I'll do so