THE FUTURE OF MONEY Bernard A. Lietaer - library.uniteddiversity ...

Derivatives: A financial instrument, which enables the
segmentation of different types of risks. The main types of
derivatives are futures (when contracted in a regulated exchange),
forwards (when contracted in the unregulated Over the Counter
market) and options. Exotic derivatives are complex combinations of
the simpler derivatives such as forwards and options.
Devaluation: Synonymous with depreciation. Reduction in value of
one currency in terms of other currencies.
Discounted Cash Flow: Calculates the value of a future cash flow in
terms of an equivalent value today. For instance $100 a year from
now is the same as 890.909 today if one uses a discount rate of 10%,
because $90.909 dollars invested for one year at a risk-free rate of 10%
will yield $100.
Euro: Single European currency replacing the national currencies of
11 European countries as of January 1, 1999. Bills in euros will be
circulating from 2002 onwards. The transition mechanism from the
previous national currencies towards the euro was the ECU, a
currency unit which was defined in 1979 as a basket of European
currencies.
‘Fiat' currency: A currency created out of nothing by the power of
an authority. Ah national currencies are fiat currencies.
Fired Ercbnnge Rnte: Rate fixed by an authority at which one
currency can be exchanged against another. This was the rule in the
Bretton Woods Agreement from 1945 to 1971, and the IMF was the
authority, which had to approve any, changes in exchange rates. The
rule of fixed exchange rates was replaced by floating exchange rates
after 1972 for most national currencies.