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Write 2 pages with APA style on The History of Money. Discussion The high level of debt of the United s government has occurred for a variety of reasons and the government is the party mostly responsi
Write 2 pages with APA style on The History of Money. Discussion The high level of debt of the United s government has occurred for a variety of reasons and the government is the party mostly responsible for the credit debacle that the U.S. faces. The involvement in war conflicts have cost Americans trillions of dollars. The overall level of debt of the United States has skyrocketed since the War on Terror started after the 9/11 attack. There are other factors that are increasing the level of debt of the U.S. government. Three factors that are increasing the level of debt in America are budget deficits, a lack of savings, and trade deficits. 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 considerations that will determine if the Google Wallet concept catches popularity include people’s preference for online shopping, greater penetration of smartphones among consumers, and the ability of retail vendors to accept Google Wallet at their stores. The Google Wallet concept does not work if a person does not own a smartphone with internet capabilities. This is a major flaw of the financial instrument.
Work Cited Page
Youtube.com. 31 October 2008. “I.O.U.S.A.: Byte-Sized – The 30 Minute Version” 5 April 2012.