The History of Money Assignment Example | Topics and Well Written Essays - 500 words

The History of Money - Assignment Example A trade deficit occurs when a country buys more than it sells. As of 2007 the total debt of the United States was $8.7 trillion (Youtube). If a new currency called Google Bucks appeared in the market I would probably be interested in owning the currency. The reason that I would be interested in Google Bucks is because I make a lot of online purchases. I would accept Google Bucks. I think that Google Bucks could be considered a form of money because it can be used to buy goods and services. The problem with the form of currency is gaining acceptance from the general public. Most people would not consider Google Bucks money if they cannot use the online currency to buy goods outside the internet. A way to legitimize Google Bucks is for the currency to be converted into U.S. dollars or other currency through ATM mechanisms. China benefits from the linkage of its currency to the dollar because its currency does not have to face competition from other currencies to keep its value. The Yuan does not have to compete in the foreign exchange market based on the internal economic conditions of China. China prefers to peg its currency and let the stable dollar become its shield to protect its economy. The United States benefits from this relation because China has become one of the top importers in the world due to the fact that the purchasing power of its people is rising. When the value of the dollar goes down the U.S. reaps the benefits of more Chinese people buying goods from the United States. I do not think that Google Wallet is going to be that influential in the lives of people. The application simply lets you buy goods online using other forms of money that you already have. The application itself does not constitute a new form of currency. Google is offering prepaid debit cards as one of the forms of currency. Prepaid debit cards are a concept that already existed which the banking industry has been using for decades. Some of the