Post #735 by Mark on the Macroeconomic Trends and Risks board

Personal Finance Topics / Macroeconomic Trends and Risks

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Why couldn’t there be two, or three currencies. ...

There could be. However it adds a lot of complexity to certain things. For example, how would the world quote the price of oil each day? Would there be 3 prices? One in Yuan, one in Euro, and one in US$? When you buy or sell oil futures, would you have to also choose the currency in which to do so? And when settlement occurs, does it have to be in that currency, or would you have to do a conversion or multiple conversions to reach the currency you need to reach? And when selling/buying futures, and you are taking into account the interest rate for the period of the future, which interest rate do you use? The one you are transacting in or the one you eventually want or some combination? Etc.

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