THE IMPORTANCE OF SAVING IN DOLLARS – PART 1
Nowadays there are a thousand ways of saving money. Some are more useful than others, although clearly, all converge in the same way: to make money profitable and allow it to give a better use to avoid that we continue remaining in debt or suffering with waiting for the payment at the end of the month.
Apart from the typical money saving tips that you can receive, such as turning off the lights at home or avoiding using your credit card, with all the odds one of the best strategies for saving that exist nowadays is saving in dollars.
In order to understand the magnitude of what this type of savings implies, we must fully understand what this international currency represents, to establish a clear idea of why it is worth having such a strategy.
Getting to Know a Little Bit More About the History of the United States Dollar.
Benjamin Franklin is nothing more and nothing less than the character who appears as the protagonist on the hundred dollar bills of the currency of the United States of America. Undoubtedly, his spot in that place was earned with great honor, since it was he who practically gave life to this currency.
In 1751, coins and paper money existed in continents such as Europe and Asia. However, in America, the money that arrived were pounds sterling which traveled by boat before it could reach the hands of American men.
Facing this adversity, Benjamin Franklin traveled to Europe to request from the English Parliament permission to obtain machines that could print money in American territory. Although his petition was denied, he decided to return to the New Continent taking with him a printer.
The rest can be left to the imagination. A piece of paper was efficient for paying for food, clothing, weapons, and even liquor, for financing the War of Independence of the United States.
The USD and the Value of Gold.
Many years passed by before this type of money began to acquire the commercial value that would allow it to come ahead of other types of economies and currencies. By 1900, the US dollar began being backed by gold. Thus, for each piece of paper money that you had in hand existed a respective gram of gold the Federal Reserve of the United States that justified its value.
This is the same model that prevailed in other types of currencies, such as the pound sterling, which has always been one of the strongest and most expensive currencies in the world. The backing system offered by gold gave the United States its gold reserves as a total reflection of its economy.
Does the idea that for every dollar you had in your wallet meant having a certain percentage of gold at the same time is still ring in your head?
What Does the U.S. Dollar Represent in the World Today?
Currently, the U.S. dollar is no longer backed by a gold reserve. The reason for this happened more than 40 years ago when President Richard Nixon established a “temporary” measure to remove it from the gold standard. The reason? During the last weeks to his presidential announcement, the value of the dollar was in dispute because of the commercial shade that gold was experiencing at that moment.
What Nixon wanted was for the dollar henceforth be backed up by the economy of the United States, which according to his words “is by far the strongest economy in the world.” That is the real reason the dollar today is one of the most stable and richest currencies in the world.