What Is a Currency and its Various Forms

1) The currency of the country and its type (gold, silver, paper);

2) Foreign banknotes used in international transactions (foreign currency);

3) Supra-counting units and the means of payment (SDR, the ECU, the transferable ruble).

Up until the First World War in the capitalist countries dominated by a system of metallic currency. We used two versions of this system monometallism when the basis of the monetary system, lay a metal, and bimetallism, when the two metals (gold and silver) served as the universal equivalent.

Under the conditions of modern capitalism supplanted the gold from the monetary system, which is based on a paper currency, which has a credit nature. Depending on the mode of use, divided into convertible currency (convertible) - which are freely exchanged for any other foreign currency, such as the U.S. dollar, deutsche mark, French franc and the currencies of most industrialized capitalist countries, ie: partially - Convertible currency convertible not all foreign exchange transactions, or for all owners, and non-convertible (closed) - operating only within one country.

In recent years, international payments, are used in addition to national and collective Rates: Special Drawing Rights (SDRs) as part of the IMF, the European Currency Unit (ECU) in the framework of the European monetary system, etc.

The main role in the capitalist monetary system is the U.S. dollar. In dollar made the bulk of international payments, fixed world market prices for many goods, accounting for an overwhelming share of foreign currency reserves. Along with the dollar a significant role in the 50's and 60's. Pound played. Recently, the growing importance of international payments DM, Japanese yen, French franc.