27 March 2013

Currency Wars: Global Sustainable Currency Summit - Sept 26-28, Xi'an China: Bitcoin

The world is looking for a replacement for the outdated US dollar global reserve currency arrangement.

 The reasons for this are fairly obvious. How can the Fed independently conduct monetary policy to support domestic US needs for a global currency?

The Anglo-American banking cartel will fight this development at every turn, because control of the currency is power.

I trust that a basket of currencies anchored with gold and silver will be on the table.  The discussion of such an arrangement was circumvented by the US and UK.

The BRICs are not happy with the status quo.  As you may recall, they have recently discussed forming their own version of the World Bank.

A global fiat currency for the world, without fiscal and political union, is the euro experience writ large.

Currencies have a life cycle, and often a regional life and custom.   No money in the world has lasted for more than ten generation and achieved almost universal acceptance other than gold and silver.  It seems to be in their very nature, and in the nature of money.

About Bitcoin

As an aside, people ask me now and then to comment on Bitcoin.    I did look into it quite intensively over the Christmas holiday and was aware of it before then. 

The good news for Bitcoin is that is does have 'a flywheel' in the fairly transparent algorithm that expands the money supply in a reasonable predictive manner.  And from a technology standpoint it does have a coolness factor.

The Achilles heel is its inherent instability because of the manner in which it is sustained and exchanged.  The exchanges are a serious weakness because they are unregulated, opaque, and privately owned.   They rely heavily on the efficient markets hypothesis and on a few other articles of faith.

Liquidity and stability is the name of the game for money:  use and store of value.

It is almost predictable that the Bitcoin currency will have speculative booms and busts, because it has the nature of a Ponzi scheme with the greatest gains going to early adopters and promoters.

It does have its good points, but I am afraid I would defer on it unless a number of sovereigns were to adopt it and guarantee liquidity and exchangeability. Starting a new currency is not easily done. It must be based on something widely accepted and easily exchanged for a broad range of goods and services with a easily recognized unit of value.

But for now the early adopters and adherents do not wish to hear this, very much in the manner of an early stage Ponzi scheme.  You'll miss out, better get aboard, you're losing money!

Money is a funny thing.  So few people understand it.  It often takes on the nature of a belief system, a religion.  I recall the very heated and passionate inflation/deflation debates of not so long ago.

Welcome to the fog of currency war.

On the behalf of the organising committee, we cordially invite you to join the Global Sustainable Currency Summit (GSCS-2013), held during September 26-28, 2013 at the International Convention Center in Xi’an, China.

Due to the imbalances in global trade, countries and regions adopted different currency policies to develop and defend their economies, causing a serious international currency crisis - even currency wars and treasury collapses.

These circumstances have led us to promote the establishment of an international mechanism to create a global currency by organizing the GSCS-2013 summit with leading economists and policy makers as international platform for the analyses of the failures of actual and past currency systems, discussion and resolution of the international currency crisis and for the determination of future needs of all nations and the world trade by defining a global solution with a Global Currency G, based on the Global Money Charter for Sustainable Development, as announced at the Rio+20 Summit.

GSCS-2013 aims to discuss and resolve the international currency crisis/currency wars and establish an international mechanism to create a global currency to create an even level playing field for everyone.

It will bring together economists, university professors, Nobel Price laureates, industry leaders, legislators and senior officers from governments, the United Nations, Regional Economic Zones, and financial institutions. Attendees will get an opportunity to meet world-class economists and bankers benefiting from their analysis and solution presentations, and also learn about the major trends of the currency markets.

We would like to invite you to be part of GSCS-2013 and actively join this historical event in the field of global currency policy. You will experience unforgettable encounters and have a wonderful travel to the cradle of the first coins and the origin of the Silk Road in China.
Read the details here.