Along with millions of Americans, I have been quite glum about our country’s current economic status. But I read an editorial in The Hindu (Sept. 27, 2011) that checked me a bit. Over the last few months the rupee has drastically weakened against the dollar. When I arrived in July the rate was Rs. 45 to the dollar, and now it has risen to Rs. 49.60, “perilously close to the psychologically important Rs. 50 mark.” Great if you are a foreigner living on dollars, not so great for the rest of the country.
Even with the US’s “lower-than-expected growth, …high unemployment and fractious politics,” the dollar continues to be in demand. With the Euro shaky, risk-averse exporters and investors in India are turning to safer places to “repatriate the money to safer destinations,” leavign the dollar as one of the only options.
(Almost every bill has Gandhiji on it 🙂 )
Such a sharp increase in the rupee threw everyone off. It will be increasingly difficult to maintain stability, discouraging the return of investments recently lost.
I read an interesting story from Germany about an alternative currency called the Chiemgauer, named after a region in Germany. Started by a high school teacher as a classroom experiment, the currency slowly caught on with businesses and community members. Apparently, it retains better purchasing power within the region than the Euro. The Chiemgauer supports non-profits that promote cultural, educational and environmental activities. One of the goals was to create jobs to students, or volunteers that would be granted an allowance of Chiemgauers. Businesses accept 100 Chiemgauer at face value and can exchange that for €95, losing 5% for commission but earning more by attracting Chiemgauer members to their products or services.
You could create currency to any closed sustainable system, whether that be a village, a cooperative, or a city. It keep the money in the local economy, and enhances the relationships between customers and businesses, promoting credibility in business dealings and the creation of products with integrity.
A currency that is controlled by the people instead of going to a centralized government or bank? But then who would be in charge to make sure the money was kept safe and managed properly? It could never work…