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Re: Free trade - a debate



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If there is no *common method* of calculating
"Sum of hundred rupees worth of rice"  or
"Sum of 2.15 US dollars worth of rice? or
similarly for other currencies and products.
Then how can free/fair trade take place? Can
anyone who studied economics explain this?

MV.

>From: prakash chandrashekar
> congratulations Mr MV,
> you just stumbled onto the biggest fraud in history - fiat money, i.e
-
> money being so only because the government says so. All Money used to
be
> pegged on a certain sum of gold /silver. Infact the words pound and
> dollar reffered to certain weights of precious metals. Ever since the
US
> dissociated the dollar from gold, no other currency is pegged on a
real
> value. All the float in the world of dollars, euros, pounds, is all
> currency with no base in real wealth. they depend  on the ability of
the
> governments to tax their people and restrict their own printing
presses
> of money.
>
> regards
> prakash
>
> Now let us define the value system of currency....
>
> For eg. the Rs.100 currency has value because,
> the governor of RBI says "I promise to pay the
> bearer the sum of hundred rupees" and this
> promise is "Guaranteed by the Central
> Government" of India.
>
> Most other currencies are also backed by
> similar promise/guarantee. What is it the
> RBI governor is promising, when he says *sum*
> of hundred rupees? for eg. If someone goes to
> RBI governor and gives Rs.100 note and ask for
> "Sum of hundred rupees worth of rice" how will
> he calculate how many kg of rice to give?
>
> For people using different currencies to decide
> the value of their goods and services all currencies
> should have a common value system, isn't it?
> As per current economic theory what is this
> common value system?
>
> MV.



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