Monday, September 27, 2010

US China Sanctions: Time for One Global Currency

When people are greedy, their finances go awry. When their finances are in disorder and they are very greedy, dishonesty prevails, the norms of business are disrupted, then troubles and problems occur. From this perspective, troubles and problems come from a dishonest mind. (Han Fei)

Finances are in disorder of many states around the world, the most glaring because of the magnitude of the size of the economy are the finances of the USA, Japan and many European countries. Greed has caused this financial disorder and chaos, greed that led invariably to dishonesty as Han Fei knew it does 2 100 years ago, now the norms of business have been disrupted. Plato, Aristotle could never comprehend such simple logic.

Now that there is chaos, the USA needing a scape goat wants to blame China and China's currency claiming it is over valued. Both sides are right and both sides are wrong, fiat currencies can be printed at will, having men treated like gods and followed at every whim like central bankers who make decisions on behalf of at times millions of people and claim that it is a market decision is sheer falsehood, more dishonesty. Central banks are institutions that have never been needed, there is no justification for them except to control the money supply itself not a justification. Therefore both the USA and China are arguing over something that does not need an argument and that will only cause further tensions as is witnessed by China's response to increase duties on American chickens as the Americans are dumping chickens onto the Chinese market.

The only real solution to perceived over valued and undervalued currencies is to go back to the one currency model that had been around and accepted for thousands of years, from Egyptians, to ancient Zimbabwe, to Greeks and Romans, to Persia and Babylon, that of Gold and Silver. You can put Roosevelt's face on gold and melt it and put Mao face on the same gold the next day because the value comes from the gold and silver content. and the gold moves between countries according to production and value created in that country.

The only way to solve these currency issues is through the world preparing for one currency, a currency that does not require a powerful central bank but relies on the market, the one thing central bankers and monetary economists fear and loath, the market.Sure there will be fools like the Adnan Khashoggi's of the world who will have gold toilets, literally pissing and defecating on money, but most people would be more sensible. The people of the world are speaking, as this article is been posted onto the blog at 2:15pm eastern time on Monday 27 September the gold price was at $1 295.60 per ounce, they are voting with their money.

Bhekuzulu Khumalo

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Bhekuzulu Khumalo

I write about knowledge economics, information, liberty, and freedom