1. Introduction

 

In this essay we attempt to estimate global money supply andrelate it to global supply of gold. For the global money supply, we use moneysupply figures for currency in circulation from 86 selected currencies, from 81independent countries and five monetary unions. For the global supply of gold,we use data from the WorldGold Council (WGC). Finally, we attempt to interpret the price of goldas a relationship between global money supply and global gold supply.

 

2. Data Description

 

For money supply, we consider five monetary unions and 81sovereign (independent) currencies. Here is a quick survey of those unions. Thefirst monetary union is the European Monetary Union (EMU), commonly known as theEurozone, and using the Euro as a common currency. It includes 16 WesternEuropean countries, such as Germany, France, Belgium, and Austria. The second currency union is the East Caribbean Currency Union, which uses theEast Caribbean Dollar, and includes members like Antigua and Barbuda. The thirdunion is the West African Monetary Union (UEOMA), using the West African Franc,and includes members like Benin and Burkina Faso. The fourth union is theCentral African Monetary Union, technically known as CEMAC, which uses thecentral African Franc, and includes members like Cameroon, Chad, and Congo. The fifth union is technically known as the IEOM, uses the French Pacific Franc,and includes members like French Polynesia and New Caledonia.

 

 

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About The Authors

 

Mike Hewitt is the editor of DollarDaze.org, a websitepertaining to commentary on the instability of the global fiat monetary systemand investment strategies on mining companies. His website also provides ano-cost market datafeed service with up-to-date quotes on currency exchange rates,commodity prices and major indices.

 

Dr. Krassimir Petrov received his Ph. D. in economics from the Ohio State University and currently teaches Macroeconomics, International Finance, andEconometrics at the Prince Sultan University located in Riyadh, Saudi Arabia. He is a frequent contributor to www.FinancialSense.com.