Storing value - stacking money - can be done by a gold standard (indeed the old idea of the gold standard system in effect tried just this, with national currencies acting as promisory notes for a quantity of gold).
The trouble with the gold standard was that it was pinned to the value of a real commodity, which naturaly fluctuates...why people just dig it out of the ground!
Counting value means that that no country makes the count go wrong by printing money.
As I just said, or digging it out of the ground. But this is precisely what does not happen with the euro, where printing of money is controlled and authorised by the central bank on behalf of all its members.
But once you leave the gold standard the currencies are backed by the strength of the economies of the nations. The value of the pound in your pocket depends on the value of the UK economy. A single currency as store of value works if all the nations have an economy of the same strength, and economies strengthen or weaken at the same rate. It cannot work on an average of the strengths and weaknesses of several economies.
Why not? You have never explained this article of faith. The euro is better than the gold standard because it is divorced from the value of any actual traded commodity. The more countries adopt it, the less meaningful are concepts such as the exchange rate with other currencies. It is literally a universlly accepted exchange medium within one very wide area. If you dont like what you can buy with it in Germany, you can go to Greece and use it.
For a currency to work you must have a full fiscal union with a single point for issue of bonds.
why? But equally, so whats the problem with the current setup?
You have to have economies which are relatively similar in a full fiscal and political union.
Why? Historically this has not been true. I remind you that the EU is in fact a highly integrated fiscal union already.
A world currency would only work with a world government and a world economy.
Nonsense. You reckon that simple gold can work as an exchange medium and historically it was used at fixed exchange rates for very long periods. A frequent theme as to why such currencies failed was debasement, which isnt going to happen with a centrally organised paper currency.
Currency unions are enormously problematic, and either break down or lead to full political and economic union.
Historically currency unions have only existed where political agreement has already been reached, and break down when the political acord breaks down. If it does not, then frequently full political integration takes place, but the currency is a sideline to the real action.
