[gg3]

The most resilient currency system is one that has at least two levels, international and regional.

Using an international currency only, produces a "tightly-coupled" economy that is highly vulnerable to the propagation of shocks throughout the system. On the other hand, a system comprised only of local or regional currencies creates de-facto trade barriers between regions. A dual system enables trade but in difficult times enables those regions that are still economically functional to continue to operate and to a certain extent assist the troubled regions in getting back on their feet.

This, like most of what I have to say, is an engineering-based model... It produces obvious predictions: that in a coming crisis, areas with local or regional currencies will be more resilient than areas that depend entirely on global currencies (dollar, euro), thus the development of local curency systems is a key ingredient in local and regional preparedness.

[Dreamtwister]

$this->bbcode_second_pass_quote('', 'A')t this point - which we may arrive at sooner rather than later - things will become very dangerous for the US dollar, and the situation is actually far worse than many now believe, because the Chinese and others are preparing to WRITE OFF THEIR DOLLAR ASSETS AS A BAD LOSS - they will try to get what they can for them, of course, but otherwise will be ready to fall back on domestic and regional demand and tough it out