News & Analysis
G20 Considers Global Currency
Chinese criticism of the Federal Reserve for flooding the world with money may get little traction among Group of 20 finance chiefs meeting in China as Europe's debt crisis and Japan's disaster take precedence. U.S. Treasury Secretary Timothy F. Geithner, French President Nicolas Sarkozy, Chinese Vice Premier Wang Qishan and European Central Bank President Jean-Claude Trichet will gather in Nanjing for a one-day seminar on the international monetary system tomorrow. A Chinese state economist called for an end to the dollar's dominance in a paper posted on a website yesterday, blaming the U.S. for fueling inflation. – Bloomberg
Dominant Social Theme: Things are bad all over. With so much going on in the world, it's time for everybody to pull together and come up with a global solution. The world is inter-dependent after all. It is because we say it is.
Free-Market Analysis: The outlines of the drive toward a global currency are becoming clearer in our view. We're continually surprised by how fast events are moving and how orchestrated they seem if you follow them closely. We've already reported on the International Monetary Funds' efforts at placing SDRs front-and-center as a workable global currency. Then recently we covered George Soros' drive to set up a new Bretton Woods-style international conference to agitate for one-world money. And now the G20 is making positive noises, as we can see from this article excerpted above. You can see two previous articles on this topic here:
The Nanjing conference is just an appetizer, apparently, with additional monetary work to be done at yet another upcoming meeting. Here's how Bloomberg puts it: "German Deputy Finance Minister Joerg Asmussen said the event isn't intended to deliver short-term fixes and is part of preparing for a G-20 meeting in Cannes in November that should yield more substantive results."
These folks sure get around. Several alternative news sites have suggested that the G20 is more or less a floating world government in everything-but-name. Maybe so. We figure the meetings are so common because none of the participants wish to put anything on paper or send each other emails. Any negotiations on such sensitive issues are discussed face-to-face in a clean room without listening devices or recordings. That seems to be the way it works. They get together a lot.
It's a little funny watching this to remember the gravity of the G7. Those long ago conferences took place infrequently and always garnered headlines. It was somewhat astonishing to see world leaders in the same place at the same time. Each meeting was commemorated with a grainy black and white photo that appeared in the newspapers of all the world leaders posing stiffly together so you could compare heights and smiles.
But today – heck it's old hat. World leaders – presidents, even – seem to get together more often than business-people planning the launch of a new product (and perhaps that's what they're doing). It's not just the G20 either. European leaders are always meeting together in Brussels. There are telephones and computers but that doesn't seem to matter. Only face-to-face meetings will do. The paranoia seems obvious.
The UN, by no means an unimportant entity, seems to be serving a different function; it's doing the non-economic (world-shaping, military stuff) while G20 leaders keep "discussing" money matters. The division of labor is clear-cut. One has to speculate of course because nothing is explained; communiques are issued; goals are established but the behind-the-scenes discussions are the important ones. You only hear about those after the fact when leaders announce yet another "understanding." (And apparently they better "understand" or they won't be leaders for long.)
It really is amazing. People think this is simply the way of the world. But we bet between the EU, the UN and the G20, Nikolas Sarkozy alone has been on the road more than he's been in France. He may be President of a big EU country, but he's surely not a sitting one. He never seems to sit. He's got more appointments than a vacuum cleaner salesman.
But maybe such strenuous efforts are paying off. The G20, which has seemed fairly hostile to Western leadership when it comes to monetary matters seems suddenly less so. Actually, the Bloomberg article contains one of the more incredible statements we've read for a while: "Criticism of U.S. monetary policy is ‘so yesterday,' said Chris Rupkey, chief financial economist at Bank of Tokyo- Mitsubishi UFJ in New York. ‘World leaders and monetary officials have a lot more important things on their plate.'"
This puts us in mind mostly of Bill Clinton who, when his sex scandal with Monika Lewinsky was at its height, kept holding news conferences in which he or his allies would suggest that the scandal was old news and that it was time "to move on." (No, it wasn't.) Political events mesh with economic ones. Now we can see. As we have suggested with such deliberate elite promotions, one merely needs to wait and eventually the pieces fall into place. Between the wars in the Middle East, the European chaos and the Japanese earthquake and ongoing European crises, there is simply no more time or appetite for confrontation – or so we now learn.
Of course it's not exactly clear how a world currency would have alleviated an earthquake, but that's not really the point. Urgency is in the air. And out of such an urgent, chaotic environment one can expect the G20 to make progress in creating a "new order." Questions could be asked, but there is no one, really, to ask. News is communicated via communiques. Thus we learn that this one-day seminar will focus in part on forward-looking monetary issues. Officials such as French Finance Minister Christine Lagarde will discuss, "shortcomings in the international monetary system and volatile capital flows."
We figure that's news-speak for "one world currency." Sure enough, Bloomberg tell us in virtually the next paragraph that Goldman-Sach's Jim O'Neill expects "possible changes to the International Monetary Fund's Special Drawing Rights to be discussed." Why is that important? Bloomberg again: "In 2009, Zhou suggested in a policy paper that SDRs may be the basis for a new global currency."
The article natters on momentarily about sales of French railroads, trains and planes but then suddenly returns to the currency issue: "[The] event also reflects the French leader's desire to organize a new ‘Bretton Woods' during his presidency of the G-20 to address what he has called imbalances in the global monetary system. He first raised the possibility of such a meeting in August and pressed the Chinese to act as hosts."
That's interesting. We thought George Soros was organizing a new Bretton Woods. Now it appears that Sarkozy is trying to do one on his own. It must be something in the water. Actually, it's an elite global promotion. That's how these things seem to work. The Anglo-American power elite, a handful of wealthy, intergenerational banking families operating out of the "City of London" has long since (maybe several generations ago) decided that the world needs a single currency. What's going on now is almost surely the aftermath.
Most recent developments? First the IMF produces a White Paper on how its SDRs could be turned into a global currency over the next decade or two. Then international financier George Soros suddenly organizes his own Bretton Woods conference to discuss a new global money – one that just so happens to include the IMF's SDRs. Now the G20 is beginning to discuss the same thing and lo and behold Nikolas Sarkozy wants his own Bretton Woods conference. Great minds think alike.
It's difficult to explain this to your friends and neighbors isn't it? Try letting them know that a silent, brutal money power has developed a script from which the most powerful men in the world are reading assigned lines. Explain, if you will, that the outcome has been determined decades in advance, that the scripts have been frozen into place years ago and that the entire world-currency "discussion" is nothing more than an elaborate Shadow Play. Go ahead. Good luck!
Still ... we're fortunate to have the Internet because the patterns are increasingly obvious. One can see the coverage evolving in a way that was impossible when only print and TV coverage was available. Just the ability to read several articles at once from different time periods (something you would have had to spend a huge amount of time in a library to accomplish even a few decades ago) clarifies the manipulation and makes the orchestration obvious – to us anyway.
Conclusion: These are likely power-elite dominant social themes, not coincidences. Money power creates chaos and provides One-World solutions. The over-riding question for the 21st century then is whether people, as they notice such evident truths (and we believe they are), will continue to put up with having their lives so managed. We don't know. Do you?
Posted by Victor Barney on 04/03/11 11:38 AM
As I mentioned in another article today, we now are at the close of the 6,000 years given man by "Yahweh" and it is written that before it closes there is to be a "cashless" society! Does not mean the entire world? We'll soon see! Watch! p.s., Hebrew(Zeph. 3:9, Acts 26:14, 1 Cor. 4:6), not Greek, Latin, or even English, is the "only" inspired language that can be used to "prove all things!" Just saying...
Posted by Onebornfreeatyahoo on 04/02/11 10:45 AM
Interesting,OK thank you. Regards, onebornfree.
Posted by Ingo Bischoff on 04/02/11 10:27 AM
"Who do you envision [or suggest] would, or could, oversee these bankers under your single accounting standard?'
My preference would be to keep the government out of the actual oversight function. However, I would be in favor of enforcement of criminal law for fraud against rogue bankers.
I'd prefer the oversight to be conducted by the commercial bankers associations or other private groups which can provide for transparency in commercial banking operations to inform the public.
However, the charter would still have to come from the state governments to assure compliance with constitutional requirements.
Posted by Onebornfreeatyahoo on 04/02/11 01:01 AM
Ingo Bischoff said :"The only thing needed would be oversight of the bankers to assure that they stick to the bank charter., i.e. adhere to the Real Bills Doctrine. Any fraud committed by the drawer of Real Bills the private productive businesses, would easily be discovered. It's the bankers that need oversight. Their fraud can be hidden for a long time. "
Who do you envision [or suggest] would, or could, oversee these bankers under your single accounting standard?Regards,onebornfree
Posted by Zenbillionaire on 04/02/11 12:30 AM
That's it. No more love for the Bug. He stands alone and falls alone. I never liked him anyway.
"He was a slob, did you ever see him eat? Starving children could fill their bellies on the food that ended up on his beard and clothes. Dogs would gather to watch him eat. I never understood gluttony, but i hate it. I hated that about him. He enjoyed disgusting people, being disgusting, the thrill of offending people and making them uncomfortable.
He will not be missed."
-- Bill Murray's eulogy for John Belushi.
Posted by Bionic Mosquito on 04/02/11 12:16 AM
"Especially when involved in humanitarian efforts to save the rare and threatened BugaBuga bug!"
I know I am rare, and I know I am threatened. I don't need to be reminded. It is so depressing.
AND I DON'T WANT ANYMORE HUMANITARIAN EFFORTS ON MY BEHALF.
/s/ The Bug
Posted by Zenbillionaire on 04/02/11 12:12 AM
"collateral damage is not their fault!"
Posted by Wayne on 04/01/11 11:37 PM
"Without corrupt officials it would still be legal to fish lakes with hand grenades in Berlin. Think about these things! :)"
But it is legal for MI6/CIA if those are terrorist fish. As for the others, collateral damage is not their fault!
Especially when involved in humanitarian efforts to save the rare and threatened BugaBuga bug!
Posted by Ingo Bischoff on 04/01/11 11:36 PM
Here are the only two steps necessary:
1. The U.S. Congress changes Title 31, Para 5103 and removes legal tender protection for payment of private debt from the "irredeemable" USD/FRN.
--- Just repeal the FRA 1913 and all subsequent statutory enactments associate with the FED. US Treasury absorb the functions of the FED and issues US Dollars, Not Federal Reserve Notes. US Dollars not debt based, no US Bond market needed and wound down.
Why bother? If you want to do anything to the 1913 FRA, remove Paragraph (b) to Section 14. But by changing Title 31 Para 5103 you are doing the same thing. We need the FRN around while it still has value to compete with the new redeemable currency which will spring up through state chartered banks. That way government employees can be wean off public employment and steered to the private sector minimizing hardship. Adter a three to five year transition period, the FRN is most likely worthless. Thn get rid of the 16th Amendment and let the Treasury
issue "Bills of Credit" to finance the federal government. The "greenback" has been a relatively successful currency for a hundred years. It could be again. It would be irredeemable, but good enough for consumption purchases. The people would vote everytime they spend a greenback whether they agree with government spending or not. If the greenback starts to create inflation, meaning the greenback falls below the value of redeemable currency, it is a signal to the federal government to stop spending.
2. At least one state in the Union will demand the full collection of land values by local taxing jurisdiction in lieu of any other tax, whatsoever.
--- More info, links ? I don't see the full picture here.
The land value tax has to do with valuing the "land" input factor in production of goods which are financed through Real Bills and are the basis for the circulation of the redeemable currency. The first state which insists on collecting no other tax than the land value tax will have such economic advantage over the other states that they soon will have to fall in line and do the same thing, if they want to hold on to population, talent and capital. The land value tax enables the proper discovery of prices in free markets.
The two steps proposed are all that is needed to get started with change. The people themselves will take it drom there. People as a group are much, much smarter and wiser than any individual could hope to be. That is how free markets work. All you have to do is unfetter them. Those two things I listed when removed would unleash unimaginable prosperity.
Things are not that complicated.
Posted by Obsvr-1 on 04/01/11 11:13 PM
@Posted by Ingo Bischoff on 4/1/2011 8:42:37 PM
"I believe I gave an example of a monetary system (Dollar) interacting to facilitate a voluntary exchange of a good (could have been a service) between two parties."
No matter how you spin it, you bartered a piece of paper with a presumed value for the value of some good at the time of the transaction. There was no standard attached to the piece of paper. There was only belief that it could buy value of some other good in the future. You didn't complete a "money" transaction, you completed a "barter" transaction.
Be careful of the terms. Words do mean things, but you have to be clear on the meanings.
I am trying to be clear and not spin, the dollar is a monetary (money) instrument that represents either a return for unit of labor, or return on an investment. The monetary (money) system is the US Treasury issuance of dollars (money) to the private sector utilized to run and grow the economy. I described what should be done to eliminate the FED, the US Bond market and the FRN (debt based money) to be replace with a US fiat Dollar issued directly from the US Treasury, with a full employment, neutral inflation/deflation policy to minimize devaluation of said Dollars. I also suggested a tax system based on a consumption tax which provides a built in stabilizer to raise taxes when the economy heats up (inflationary environment) and reduce taxes when the economy cools (deflationary environment). The only difference an avg person would see from the monetary system (money) would be the printed dollar would say "US Dollar" "Treasury of the USA" instead of "Federal Reserve Note".
Where I am not clear is what your words (terms) are for an "money transaction" and "accounting standard" that a mere mortal (avg person) could understand.
Posted by Zenbillionaire on 04/01/11 11:12 PM
"A "commercial banking" system based on the Real Bills Doctrine would have no trouble coming to an agreement on an accounting standard based on the universally accepted standard of value. It is central bankers which would fight the idea. "
All kidding aside, we have the FASB today and they aren't exactly doing a bang up job. Are they in fact a market driven force or are the a covert arm of the IRS? Enquiring minds & etc. Please insert your opinion here...
Posted by Ingo Bischoff on 04/01/11 11:02 PM
"Let's enjoy the moment, as it will fade quickly next time the subject of real bills and inflation arises!"
Your are absolutely correct. I shouldn't be getting giddy..... I'll try to contain my joy.
Posted by Ingo Bischoff on 04/01/11 10:58 PM
1]Exactly who do you envision implementing and enforcing this standard[assuming, for the sake of argument, that it could be achieved in the first place]?
A "commercial banking" system based on the Real Bills Doctrine would have no trouble coming to an agreement on an accounting standard based on the universally accepted standard of value. It is central bankers which would fight the idea.
2]Whom [if anyone] do you see as overseeing those who enforce this single standard?
Once the standard is agreed upon, the commercial bankers, and the businesses drawing Real Bills would police the standard without any need whatsoever from involvement by the governments.
The only thing needed would be oversight of the bankers to assure that they stick to the bank charter., i.e. adhere to the Real Bills Doctrine. Any fraud committed by the drawer of Real Bills the private productive businesses, would easily be discovered. It's the bankers that need oversight. Their fraud can be hidden for a long time.
Posted by Zenbillionaire on 04/01/11 10:49 PM
"Why would we need some corruptible official on the payroll to do what is automatically done now?"
Without corrupt officials it would still be legal to fish lakes with hand grenades in Berlin. Think about these things! :)
Posted by Ingo Bischoff on 04/01/11 10:49 PM
Anything like the SAE or API standards would be fine with me.
Do not forget that I prefer "commercial banking", not "central banking". Commercial bankers do not care who sets the accounting standard, they only worry that they are fixed and remain constant over decades and preferably centuries.
And, do not forget that it is productive businesses drawing Real Bills which are the basis of "commercial banking". They more than anyone will want a fixed accounting standard and a standard of value in the currency circulated in lieu of their Real Bills.
Posted by Bionic Mosquito on 04/01/11 10:12 PM
Whether I agree or disagree with your views, I am always reminded of the best that a dialogue in a community such as this can bring forward, through your example.
"People do not see that we have daily fluctuating "accounting standards"Click to view link is von Mises that recognizes the necessity of a fixed "accounting standard", yet most followers of Austrian economics insist that the "accounting standard" should be set by the "free market". Go figure........"
Ingo, I do not see a problem of the free market setting the accounting standard. It is in the benefit and interest of participants in a free market that a standard is agreed upon (for reasons I have outlined more than once above). It is also in the interest of market participants that the standard does not change frivolously or regularly.
Please keep in mind my point above in an earlier post: most if not all actors in the market today view the standard as the currency in the jurisdiction of their operations. Therefore, through their eyes, they do NOT have a daily fluctuating standard: they keep the books in units of FRNs or Euros or whatever. Imagine if they had to restate their financial position daily denominated in ounces of gold instead of FRNs, for example. They would NEVER stand for such a system. They would demand a fixed standard!!! (Before others misconstrue, they could come together as a business association like the SAE and set a standard without government involvement, see note below)
The free market will not result in a fluctuating standard for the same reason. Left free, I think we both agree that the market will settle on gold of certain fineness and weight as the standard. After that point, an ounce will always be an ounce. But the standard will not change, as the "price" of gold in some non-redeemable piece of paper will not be relevant for much of anything.
To summarize, the free market would be quite capable and desirous of setting an accounting standard, and to the extent participants wanted to broaden their opportunity for exchange and maximize the benefits of division of labor and investment, they would voluntarily adopt the standard.
Note: I believe standards are set in various industries by private groups in many cases, Society of Automotive Engineers, for example.
"Now, we are singing from the same sheet of music."
Let's enjoy the moment, as it will fade quickly next time the subject of real bills and inflation arises!
Posted by Onebornfreeatyahoo on 04/01/11 09:22 PM
@ Ingo Bischoff
So it is fair to say in the interests of world peace and prosperity [as you define them]that you advocate a single, universal accounting standard, yes?
1]Exactly who do you envision implementing and enforcing this standard[assuming, for the sake of argument, that it could be achieved in the first place]?
2]Whom [if anyone] do you see as overseeing those who enforce this single standard? regards, onebornfree.
Posted by Dave Jr on 04/01/11 09:02 PM
Good point, the Fed and by extension the FRN is accountable to no one. And the point I was going to add is that the Fed is more private than public.
Posted by Ingo Bischoff on 04/01/11 08:57 PM
"So you believe that "a world wide fixed "accounting standard"" is both achievable [by whomever] and necessary to your ultimate goal ,which would appear to be world "peace and prosperity", correct?"
Posted by Zenbillionaire on 04/01/11 08:54 PM
@ Ingo Bischoff
"You cannot save such currency. You have to spend it while it has value."
Simple and to the point. The amount of time you have right now to divest yourselves of the USD is directly related to the amount of time it will take the general population to understand this basic truth.