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A new global price unit, independent from currency units,proposed as solution for the world economic crises
Francisco V de Oliveira, Jr., São Paulo, Brazil.This article proposes the creation of a global price unit/scale independent from currency units as a way toachieve stabilization of the world economy. It is based on the reasoning that prices do not need to beexpressed in terms of currency units and that such traditional way of expressing prices is wrong andmisguides decisions of investment or disinvestment, leading economies to crises. As an alternative to theuse of currency units to express prices, it is proposed the use of an abstract price unit/scale, similar toother scientific abstract scales, like the Kevin scale, associated with the use of variable conversion rates torelate the abstract price unit to currency units. With such new global price system composed of anindependent price unit and conversion rates markets can lessen monetary effects upon prices and have aclearer view of real relative price variation, achieving economically sound decisions of investment ordisinvestment and, thus, stabilization of the world economy. Since this proposal has a great potentialimpact on the global economy, further discussions and experimental tests are still necessary. The article iswritten with a true or false question after each theoretical item to facilitate evaluation of its entire orpartial merit and correction or improvement of its theoretical foundations where needed.Key-words:
economics, economic crisis, monetary reform, price theory, price system, price unit, currencyreform, poverty solution, economic stabilization.
Separation of currency scales from the price scale, by means of creation of an abstract price unit, is a solutionto achieve long-term stabilization of the world economy and prevent economic crises. (True or false? 01)
The same unit with which quantity of money is expressed, for example, 1000 dollars, is also used to expressprices, for example, a thing called X costs 1000 dollars. Is it really necessary or even beneficial? This is themain question. To answer it the following theoretical steps must be understood.Economic stabilization is not a matter of continuous economic growth. Indefinite growth will lead tooverproduction and overpopulation of the world with industrial products. Marginal utility of things willsharply decrease. (True or false? 02)Economic stabilization is a matter of balanced supply and demand. (True or false? 03)