What is meant by world-wide currency?
Currency represents goods. It is a unit of value measure and medium of exchange. The world-wide currency is a medium of exchange recognized all over the planet. The first world-wide currency was gold. Until a decade, all currencies were convertible in gold. Then the amount of coins in circulation exceeded the amount of gold. Today, the states and the central banks together have reserves of approximately 200,000 tons of gold. The coins in circulation represent 75 million tons of gold, 375 times the reserves. The gold reserves guarantee therefore only 0.266% (2.66 per thousand) of the value of the outstanding monetary mass. Gold remained world-wide currency because is it still recognized as a medium of exchange all over the planet. But, in practice, it has been replaced with coins almost without any real value. For this reason it was necessary to institute a currency that had an equal real value to the nominal value. Dhana.
