I have a question that I have often wondered about. Could the United States join the Euro? I am NOT asking about the European Union. There are countries that participate in the Euro but are not part of the EU. I would PREFER a gold or silver backed currency but the USA joining the Euro would have advantages over staying with the Dollar.
In other words is there anything baring the US from joining?
Sure, but this is pointless because using the Euro is equally as economically destructive as using our own fiat currency. The mechanics are very simple, the US need only accept Euros as legal tender (A means to pay debts). The exhange rates are commonly available and thus it would be easy to use the Euro or any other currency. Would there be some benefits to doing so? Probably but they are not significant. The English certainly did not believe them. The joke in England was: If you want the UK to adopt the Euro then simply multiply the value by 1.6, change the symbol from an e with 2 lines to a cursive L, have the Bank of England instead of the European Central Bank set the interest rate and lastly call it the Pound.
You should be asking if the US should use the Euro. The answer is NO. There is absolutely no benefit from substituting our own fiat currency for someone elses. Eventually the central bank realizes that its owner (not the people) the Euro Zone governments can spend more and stick thier citizens with a hidden inflation tax. Accompany that with a brief period where exporters see a currency advantage and you have the typical hyperinflative situation that you have seen in South America, Japan and now the USA.
The only currency swap that would be better for the US would be to re-adopt the gold standard and destroy the Federal Reserve/National Bank.
It would never happen.
The US will remain on the fiat dollar until it is no longer able to, then it will fall back on its massive gold reserves.
Edit:
Our current “fiat” system is actually backed by oil. The dollar’s easy conversion into oil is its true backing. We often hear that wars are fought over oil, but they are actually fought in defense of the petrodollar.
What gold reservers? If all the gold in the US (not including stuff in the Earth) was backing up the currency, then the price would need be about $7000 per ounce. If the US Gov Gold Reserves backed up the currency then the price would need to be about $20,000 per ounce. There is a huge disconnect between the price of gold and the number of dollars in existence. This transition would be painful for debtors and good for investors. But the government hates investors!!!
The problem is mainly political. The ECB has always had a very hard time adjusting a single currency to many different economies and political systems. For example the German people can withstand everything but one: rampant inflation. Monetary “stability” has always been the prime objective of any politician who wants to retain his seat at the Bundestag. Helmut Kohl and Gerard Schroeder both paid their (by normal standards) moderately inflationary politics, mostly caused by the political need to “pump public money” into the derelict former DDR without openly burdening the ailing former FDR (already chocked by Willi Brandt’s suicidal social reforms). For contrast inflation has always been a constant in Italy and it is still now despite very high taxes to fund the immense State apparatus. Italian politicians have come to rely on inflation and won’t stop anytime soon. The ECB needs to adjust monetary politics accordingly…
The US have shown a marked tendency to inflation and, what’s more important, they have a global war going on (those jet fighters need fuel and spare parts to keep on flying) and an ever-expanding State to feed. Oh, I forgot that the US by itself (excluding their depencies, protectorates, occupied territories etc) has 300 million citizens, aabout the same as the whole Euro (currency) area.
Is this still not enough?
I predict that the fall of the US dollar will be followed by the creation of a global currency, if that is not preempted by the aggressive propogation of free-market currency. And a global currency will almost certainly be even more inflationary than any current monetary standard.
I don’t think we’ll have a global currency right away. They are destroying the US dollar which will take the Canadian dollar and the Mexican peso with it (and probably South America’s currencies). I figure they’ll create a North American currency (the Amero) and South America will form their own currency or they’ll just adopt the Amero. They’ll get it by saying “oh look all of these competing currencies and look what it has done. If all of our nations joined one economic bloc we could create a currency like the euro. Look how well it is doing! It will be the same thing here!” And the sheeple will go for it. Let’s not forget the American parliment that will be established, just like Europe has which will quickly get rid of our constitution and the constitution of every other nation. Once that is set up then they can move forward with joining Europe with North and South America. Africa will probably fall in line shortly as well as most of Asia and Australia. Tada…world socialist government of death and tyranny.