Q&A: Questions (Due to Lack of Knowledge)
Questions (Due to Lack of Knowledge)
Question
A. What is "currency that is in circulation"?
B. What does it mean that a coin sometimes has the status of "currency" and sometimes the status of "produce"?
C. What does it mean that a country has a floating exchange rate for its currency?
D. If I lent my friend one hundred shekels, and by the time of repayment the value of the shekel went down (or up) – say that at the time of the loan, with one hundred shekels I could buy two bottles of water, and now at the time of repayment only one – how much does he have to return to me: one hundred (as at the time of the loan) or two hundred?
Answer
A. Legal tender; tradeable.
B. I explained this in the lecture.
C. This is a phenomenon unrelated to what we were discussing, and it seems to me that it is connected to the fact that the value of the currency is determined by the country's economy (its goods and output). As far as I understand, this was not the case in the past. But that's a question for economists.
D. The accepted halakhic ruling is that it follows the money and not the commodity value (that is, purchasing power). In Jewish law, a change in the value of goods is not considered a change in the value of the currency, but rather a change in the value of the goods.