![]() On the downside, the US has been forced to maintain a permanent current-account deficit – in this case, a massive trade deficit funded by selling its government bonds abroad – to maintain its reserve-currency status.Doing cross-border business has been easy for the US, given that effectively all major commodities are traded and settled in dollars.For decades, the US dollar has stayed relatively strong versus other currencies as investors have pushed up its value.This brought the US both enormous economic benefits and significant structural downsides: With the US dominating international politics during the post-War period, the dollar soon took the place of the pound and became the world’s reserve currency. Its share of currency reserves among international central banks fell from around 60% in the early 1950s to less than 5% by the mid-1970s, and its value fell from more than USD 4 per pound at the end of WWII to near-parity with the US dollar in the mid-1980s. Then sterling’s success story became a cautionary tale. The British pound sterling was the currency of choice for international trade and value preservation from the mid-19th century until the mid-20th, when two World Wars and a Great Depression took their toll. Over time, the Roman denarii, Venetian ducat and Dutch guilder each took its turn as the commonly accepted medium for trade, and as the basis for valuing all other currencies. Throughout history, international traders and bankers have typically used one country’s currency as a default base of exchange. Yet while a passing of the mantle could be painful for the United States, a more balanced reserve system – one that relies more on the euro, renminbi or yen – would likely help the global economy in the end. It might be worthwhile to look into.What would happen if the world stopped depending on the US dollar? There is growing evidence that after years of dominance, the dollar could be losing its status as the world’s reserve currency. This note is a piece of history, and right now you can still find it without too much difficulty on the web. There is no shortage of incompetence in government, and at the very least the 100 trillion dollar Zimbabwe note demonstrates how world leaders can sometimes make decisions which spin countries out of control. And, at the very least, it’s a conversation piece. Beyond being a novelty, Zimbabwe bills represent an asset preservation method that can help you diversify your ability to retain finances. This is why things like gold, silver, property, antiquities, and art carry the value they do. Inflation and deflation will continue to change the value of fiat currency. ![]() When currencies are in constant flux because of poor decisions on the part of the government, it can be a wise choice to invest in tangential means of asset preservation. If you’re smart, though, you could end up making more on your investment through such a coin than you would have expected. What will be the value of such a piece of history in twenty or thirty years? It could double, triple, quadruple, or more.Ĭertainly varying factors will determine value. If you don’t know where to find one, you’ll have trouble getting it. ![]() As it turns out, this force is still in play when it comes to modern forms of currency that are out of print, or otherwise difficult to find.Īccording to, Zimbabwe dollars represent some of the most unique antiquated currencies that were ever printed: “With 14 zeros, the 100 trillion Zimbabwean dollar bill has the most number of zeroes to ever be printed on a single note.”Īdditionally, there were only a few million copies of this bill ever printed and they are quickly disappearing. Time has increased the value of the coin. Authentic versions of this coin can’t be found in today’s world. Coin quality is also a big part of that, but because of the nature of antiquity, the historical value of a denarius can make it much more valuable. What has changed? Would anyone say a day’s wages in Roman times was worth $900 by today’s reckoning? Some of those coins will go for $900+ today. ![]() What’s interesting about the Denarius today, however, is that it is worth much more than the $3.62 in silver, depending. Hyperinflation has led to a difference in values. That may not seem like much, but as it turns out, $3.62 in value held a lot more weight several thousand years ago. By today’s numbers, the quotient of silver contained in a denarius is worth about $3.62. During Roman times, there was a period when a denarius was worth about a day’s wages.
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