The New International World Order movement (NIWO) gets stronger nowadays. The need of change caused by current global humps (first and notorious one is so called ‘West vs Rest’ division) dictates necessity of searching new roads for global development. After Global Financial Crisis (GFC), fertile land of ideas grew. One of them is proposition of changing current monetary system. Call for “another Bretton Woods,” this time in 2.0 version. Materialisation of it, i.e. Positive Money movement originated in United Kingdom, is inciting, inter alia, taking rule of printing money out of commercial banks. Current monetary system is based on unfortunate principle where value of money is connected with “believe in believe” in the fiduciary money intrinsic value. Crucial component that stands for global economic system circulatory system is basing on out-of-thin air monetary system, becoming its uncontrolled Lacan’s objet petit a. Unfortunately, by the way, creating hoarding effect – accumulating capital in the hands of so called HNWIs, High-Net-Worth- Individuals, which thesis indirectly proves Thomas Piketty in his “Capital in the Twenty-First Century.”
Therefore, is current monetary system on Buckminster Fuller’s critical path? Is alternative possible? According to author’s opinion – the answers to both questions are definitely “YES.” System washed by fiduciary value-denominator is changing the geography of world economy creating so called “capitalless islands” and contributing to disadvantageous extremely multi-speed world development model. In it capital havens (concept synonymous with environmental counterpart – pollution havens), such as London’s City, gather most benefits. Excessive dollarization centralizes profits in the hands of a few at the expense of many (countries), provoking monetary rebellions, which great case study shows James Rickards in his “Currency Wars – the making of the next global crisis.” Current monetary system creates phantom value, where manicure for puppy is more expensive than dinner for homeless. Finally, which seems to be the most important, it is building machine which detaches financial economy from physical economy. Example? Consumption of non-renewable energy sources – sources which are crucial for world Gross Domestic Product. Fiduciary system does not see anything wrong with stock-calibrated economy despite refocusing it to flow-calibrated economy. What the author has in mind? Unbridled deposit/currency worldwide ratio.
In the field of energy resources, and rare earths too, humanity is relying on deposit (stock) instead of currency (flow). It is as if household’s finance rests for the most part on savings accumulated through generations despite month-by month earned salaries. Frantic, short-termed, irresponsible action. Current fiduciary monetary system does not have any implemented self-regulating tool that would deterred using up, once at the end finite, underground resources as coal, oil and gas (i.e. for earlier said commercial exertions of manicure for puppy), taking up more and more savings from Earth’s energy budget balance.
According to DollarDaze.com author Mike Hewitt, globally there were U.S. 55 trillion money figured out as M2, which is wider definition of money, taking into account cash in the circuit, money deposited in checking and saving accounts and money market funds. Sum is created by adding up value of 135 world currencies and data from 165 central banks and financial ministries. As shown by the German hyperinflation in 1923-24 or quite recent Zimbabwean case, politics rules the monetary system at all. Elites can do with its’ nominal value what they like. But real value lies somewhere else. Can the government disable the sun? Nope.
Bonding current value of money with current flow of the solar energy, which is the source of all surface life, is justified. Purpose of transforming world economy from stock-consumption model to healthy flow-consumption model is the main rule-of-law of alternative currency system. Monetary system that is not tied to this material “Millennium Development Goal” is not useful and dangerous in the long term.
Earth value locations are strictly capitalistic because they are uneven (Arabia has an oil, Albania none) and derive value from David Ricardo’s scarcity law of rent. One needs to remember that scarcity law of rent can be easily manipulated i.e. by reducing or hoarding supply and reserves. By binding monetary system with external source – like Sun – this kind of systematical risk may be reduced. In its present state it is impossible.
Purposeful money system, which task will be subjugation of solar flow potential of 23 000 TWy (Terawatt-year) when all coal stock, denominated in its potential, is just 900 TWy – opens great opportunities for development.
In the first step of implementing alternative currency system (i.e. British Tradable Energy Quotas or DeKo currency) the purpose is eradication of “time machine effect” in the current monetary system (in real life there is no option to consume yesterdays’ Sun today or tomorrow’s solar energy yesterday – despite consuming plants, which incorporate Sun’s flow). But today’s stock-denominated monetary system approves taking money from the future i.e. in the form of loan for 30 years. This destructive phenomenon is widely described by Tomas Sedlacek in “Economics of Good and Evil: The Quest for Economic Meaning from Gilgamesh to Wall Street.” Money should have expiration date connected with condition of physical, not financial economy. This is basic postulate. In the second step, value of money should be reoriented from stock to flow, which means that it should calibrate nominal and real value in favor of flow-consumption by making it cheaper to the disadvantage of using up stock-consumption model attributes, non-renewable resources (savings). Today the situation is completely opposite.
Source of Photo: rosaluxemburg (Flickr)