DIGNITY RUPEES CURRENCY = DIGNITY OF THE REPUBLIC OF INDONESIA
Currencies U.S. Dollar Euro
Recovery of global economy and financial system stability pattern Indonesia was still too vulnerable to rumors relating to economic and financial problems.
Rumor sanering or decrease in the purchasing power of money very quickly spread among the people as the Governor of Bank Indonesia (BI) describes discourse redenominasi rupiah. Although still referred to his own discourse and the Indonesian economy was in good condition as reflected by the relatively high growth and inflation is under control, that could arise to anxiety and panic among the public. Conclusions can be drawn, the community was not 100 percent confidence in the government's economic policies and is easy to believe the rumors and issues circulating in the community.
BI discourse rolled off of a good idea to streamline the payment system rupiah. Currently the largest currency denomination is 100 thousand dollars, and in fact often found someone should bring a lot of these sheets for transactions worth millions of dollars. If this is allowed to continue, one day is not impossible that BI should create a larger sheet of dollars more, say 200 thousand or 500 thousand.
This possibility suggests that the rupiah will bring a "less valuable" and instead of foreigners will see Indonesia as "the rich" with money in his wallet to hundreds of thousands or even millions of dollars.
Before the BI stuck having to produce large sheets that do need to immediately find a way out to produce fragments smaller currency, but has the same purchasing power and not harm the user's currency. In addition, BI would not be forced to print more money which would cost no less.
Redenomination not the first in the world, nor the first in Indonesia. The older generation still remember how to do sanering Old Order government was not only cut the nominal value of money, but worse also cut the real value of rupiah.
They certainly do not forget that while Indonesia's economy was in very poor condition with unusually high inflation and low economic growth. Political conditions as it also exacerbates the economic recovery efforts that attempt sanering not bring the economy to a stable condition.
After the era is then included in the conditions of macroeconomic stability, further devaluation issue to public attention because of the rupiah against the dollar remains pegged to the United States (U.S.) and every time the government should adjust the exchange rate, there was a bit of "uncertainty" in the community.
Simply redenominasi can be defined as the nominal value adjustment of a currency while maintaining the real value or purchasing power of currencies. Adjustments are usually done is to reduce the nominal value of the currency due to the current nominal value is considered to be too high and inefficient for the payment system.
Based on this simple definition, the essential prerequisite of success redenominasi is the ability of governments and central banks to control the rate of inflation the economy of a country so that people's purchasing power will not decline drastically.
Prerequisite is not the case when the government made in the Old Order sanering because inflation was relatively restrained. Prerequisite skills to maintain the real value of these currencies would have to be proven for a considerable period panjang.Tidak just one or two years. Even the central bank should be quite sure that during the transition period in redenominasi process, they will still be able to keep inflation low enough level.
A fairly long transition period is an indispensable prerequisite of success redenominasi currency. How exactly the transition period itself is highly dependent on the level of monetization of the public, public confidence in the currency and economy, as well as the ability of central banks and governments as well as the dissemination of public education.
A high level of monetization, the full confidence of economic policy and the high level of public education will accelerate the transition period while ensuring a smooth redenominasi.
Examples are often discussed in the media is a successful Turkish lira redenominasi Turkey that the bill "one million lira" have disappeared from circulation and the current Turkish people are familiar with the transactions generally involve tens and hundreds of lira. We happened to have visited Turkey in the transition period and had redenominasi surprised when billed taxi payment of three million lira.
It turns out a fantastic bill that could be solved only by removing the three pieces of broken 1 million lira. When the deal at the mall and hotel, the employees there are familiar with the new lira unit and never again mention millions of lira.
The most critical period of transition is of course the existence of old and new currencies simultaneously and adjusting the value of money itself. Redenominasi the legal basis must be strong and just laws that could dampen public concern over their real purchasing power.
By law, all financial agreements may continue to apply without prejudice to the parties involved and there should be strict penalties if there are those who try to attract an undue advantage of the transition period.
One more thing to watch out for is the ability to control inflation, especially inflation potential that can be done by the seller of goods and services. Because people may still do the adaptation of understanding the new currency during the transition period redenominasi, needed extra supervision as well as public education to the sellers of goods and services that do not utilize this period to gain a moment.
Psychologically, for example, a seller will think long to raise prices by 10 percent of an item is worth Rp 1 million because it means there will be an increase of 100 thousand which is large enough nominal and could dampen consumer intentions to buy.
Instead, the consumers who do not understand fully the redenominasi, raising the prices by 10 per cent of new dollars are worth Rp 1,000 Rp 100 would be more easily done because the consumer is still great difficulty digesting the absence of price increases.
In short, if this aspect is not addressed, the central bank would keep inflation hassles that are not expected. Perhaps it is too early redenominasi discourse to be launched or discussed at the wrong time, when Indonesia's economy will still need to find a better solution to overcome poverty.
However redenominasi itself is important to maintain the dignity of the rupiah as the currency of the Republic of Indonesia. Certainly dignified currency currency that is recognized in his own country, have a relatively strong purchasing power and constant, and not very big mess. Turkey is aware of, one million lire not make their currencies after the redenominasi respected and successful, they are enjoying rapid economic progress. Quarter of 2010, Turkey recorded economic growth of up to 11 percent, second only to China among the members of the G-20.
Indonesia's economic growth needs such as an effort to reduce unemployment and poverty quickly. Should be replaced after redenominasi rupiah name? To answer this, needs to be done prasurvei the general public to see whether or not it is difficult to understand the change from old to new dollars without any change in name. If it is difficult, there should be a new name as that of Brazil. Again, that should be kept in redenominasi process is the ability to control inflation and maintain the real value of money.
Dutch society has experienced a difficult time when their currencies, guilders, turning to a relatively stronger euro, so that the Dutch people's purchasing power is interrupted during the transition period., Www.dprku.com
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