1. those with the cash do NOT suffer in this scenario. they move to countries whose economies are healthy - the ones who are producers of valuable goods and big exporters. they have cash to lend and a very favorable market. they can and do demand spotless credit and ironclad guarantees of repayment and premium rates. they get it because they control the money. the whole world does not end in ruin...because as in Mad Max, someone always has valuable resources such as energy, weapons, food and ipods.



2. the currency of the producer/exporter states would not suffer because these valuable currencies would be required to purchase energy, weapons, food and ipods.

the USD can become essentially worthless if the US Govt goes under an we become South Canada or extreme northern Mexico...



a more realistic scenario is like the icelandic kronur,
the exchange rate gets cut in half. barter could indeed
become a dominant mode of transaction - see Somalia - but also it is worth noting that currency is still prized even in Somalia. that's why they have piracy and ransoms. the Somalis want USD and Euros to buy fun stuff like massage oil and condoms!

barter sign on mingle2:

"will pander for attention"

it is very possible.... and is not a difficult thing to set up... Di, have a look at the LETS scheme, used in Maleny, Queensland, Australia....an incredibly effective form of moneyless barter.