Talks About Global Currency Gain Traction
March 22, 2009 · Posted in General Economics
Many thanks to my friend LauraB for pointing this out:
In an exchange with her I added my 2 cents to the ongoing rumors about the possibility of a move toward a global currency:
It is certainly true that there are many things hinting at something like this. The central banks executives and finance ministers keep meeting on a regular basis now. If the European elites were able to sell to the European public the flawed idea of a pan-European currency, what keeps the international elites from doing the same to the world population? But in order for something like this to appear even remotely palatable a long worldwide PR campaign will be necessary.
Right now, with all the trouble that these clueless people are dealing with, I just don’t see how they can stack on top of that the project of unifying the currencies of the world into one world currency. If anything, I think this will be a very very long term project.
If you look at the description of SDRs (http://en.wikipedia.org/wiki/Special_Drawing_Rights), they already possess a lot of the features that the European Currency Unit had in Europe as a prelude to the Euro.
I expect that if there is to be a concerted move toward a world currency, it will coincide with more and more talk about SDRs in the news and in the government propaganda all around the world.
Laura points out the following on this matter:
Good call on the increasing talk in the media of Special Drawing Rights (SDRs) before the push for a global currency.
Here are two articles from last week that mentioned SDRs:
1. U.N. panel says world should ditch dollar
According to this article, the U.N. Commission of Experts on International Financial Reform will recommend to the U.N. on March 25, 2009 that “the world ditch the dollar in favor of a shared basket of currencies.” Under the heading “Good Time”, U.N. panel member Avinash Persaud talks about using something like an expanded SDR as the reserve currency.
This is the link to the accompanying video of the interview with U.N. panel member Avinash Persaud, who is also chairman of consultants Intelligence Capital and a former currency chief at JPMorgan:
2. China backs talks on dollar as reserve -Russian source
According to the article, ” The source said the Chinese paper envisaged the International Monetary Fund’s Special Drawing Rights (SDRs) being first assigned a role of a clearing currency on some transactions and then gradually becoming the main global reserve currency.” The article also mentions that the U.N. panel is looking at using expanded SDRs as a new reserve currency.
The article says that Russia plans on raising the issue at the G-20 meeting on April 2, 2009. According to the article, “The source said that India did not object to the discussion but was not prepared to take the lead. The source said South Korea and South Africa backed the idea, while developed nations were not “allergic” to it.” The Russian Finance Minister told reporters that he thought “it would take up to 30 years to create a new super-currency.”
A global currency would aggravate all the disastrous effects of national central banking enormously. There can’t be any doubt that the idea is nontheless becoming more and more palatable to world leaders. No matter how distant its potential fruition, individuals worldwide need to make sure these harmful aspirations are nibbed in the bud and reject the idea unconditionally.
What we need is the exact opposite. The global monetary system needs to become less centralized so as to increase and enhance regulation. We do need more regulation, not more government decrees, monopolies, and power that lead to less regulation. A global central bank would be just that. There simply is no better regulation of the global money and credit markets than Gold’s Honest Discipline. The history of money has shown us this time and again.