International travelers to Europe prior to 2002 and the introduction of the Euro might actually have saved their French Francs, Spanish Pesos, German Deutsche Marks and Italian Lira are holding the remnants of demonetization. In basic terms, demonetization occurs when a government decides to change its currency to address inflation, facilitate trade (such as with the Euro and the EU), to combat counterfeiting, or to halt black market cash proliferation.
Brazil is an example of a nation that has deployed demonetization on several occasions. The first cruzeiro was introduced in 1942. Due to inflation, a different cruzeiro was commenced in 1967. 1987 saw a switch to a new currency, the cruzado. The cruzeiro was reintroduced in 1990, only to be replaced yet again to the real in 1993, which is still the national currency.
Due to economic and civic unrest as a result of the large influx of Middle Eastern migrants into Western European nations advocated by Germany and the EU, Italy and France have growing domestic movements to follow the UK’s Brexit. If this happens, perhaps those old Francs and Deutsche Marks may be worth something again.
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Finance: What is Devaluation?1 Views
Finance allah shmoop What is devaluation steve Valuing a currency
i am making it less valuable can only happen when
the government which controls that currency decides to devalue it
So yeah it's a kind of their call when and
how much basically devaluation happens when a country decreases the
value of its currency against other currencies A lot of
times by just running the printing press all night printing
a whole bunch of their currency there's a whole lot
of supply on the market Well why on earth would
a country ever intentionally do this like devalue their currency
Well usually because it wants its goods to be less
expensive abroad like to be ableto export them more cheaply
to places like the u s and china and russia
by a lot of whatever's Well when a currency is
devalued the homegoods iii the home country goods are cheaper
in other markets This will usually lead to an overall
increase in exports for that country when it comes to
exports and imports though there's a kind of a union
ng ng anyway there's a counterbalance at play here imports
become mohr expensive and consumers at home likely shift away
From foreign teo purchase in country goods right it's kind
of protecting the country's own domestic product there Currency changes
Yeah well the result Yeah strengthened domestic product sales in
all of this might sound hunky dorey But while there
are some potentially nasty side effects local companies are getting
a bit of a break here which might make them
inefficient Slash lazy slash sloppy slash lacking in competitive spirit
to go fight it out in the global markets No
plus one of currency is devalued Each unit is worth
bless and that can lead to inflation which causes all
kinds Other problems down the line So that's just the
nutshell of devaluation making money not worthless But you know 00:01:57.019 --> [endTime] worth less
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