Money and Currency

Money is a store of wealth that may be possible to use as a means of exchange and currency is a means of exchange that may be possible to use as a store of wealth.  Definitions are important.

The Suffocation of Economic Central Control

Centralised control, whether 'the state' acting as if the market or, ostensibly, the 'market' acting as if 'the state', fails (as does tickling yourself fail to raise a chuckle).  What central 'control' is supposed to do is 'sense and react' and therein lays the two fundamental problems:

1/. the input is always going to be faulty (how can such a system be sensitive enough, accurate enough, smart enough to take account of every permutation)?
2/. the output is always going to be faulty (how can such a system be reactive enough, delicate enough, effective enough to take account of every permutation)?

And that does not take account of the two secondary problems, (problems that would remain even if the system of centralised control, be it faux market or state, did not suffer from the two fundamental problems):

a/. the centralised control is always going to attempt to manipulate the market by way of attempting to provide favourable conditions bias to suit its own agenda
b/. the faulty outputs and bias manipulation of the centralised control will distort the market away from the form it would otherwise naturally be drawn to.

Centralised control treats the economy as though it is one big thing and that then all the micro commercial activities will feed from that initiative, as if little piranhas swarming onto whatever gigantic carcass has been fed to them.  That may be fine for feeding identical fish but the economy is rightly comprised of totally disparate elements - it is an ultimately diverse ecosystem.

The great thing about diverse ecosystems is that, left alone, they manage themselves.  There is still a form of centralised control of economies but that is because: each and every element of the whole is a self regulating economy in itself.  The effect of each element, free to act in its own best self interest, is that a system of each element's independent economy acts upon a plethora of spontaneous and autonomous sub-economies to effectively create a whole.

It is not only imposable to replicate or replace the effectiveness of this type of system, it is unnecessary to try (unless the intention of influencing is for one sub-economy to do so in order to attempt to change the whole for reasons of self-interest).  It is unnecessary to try to replicate a system of sub-economies because: since the sub-economy system is so refined and reactive it cannot be bettered for servicing the interests of the sub-economy system as a whole.

There is no such thing as 'the economy', it is just a conceptual idea to explain the 'system of sub-economies' as a whole, just as there is not such thing as a forest, that is just a word for the conceptual idea of many trees, plants, animals living together in one place, symbiotically acting as a if a whole too.

Is BitCoin a Bit of a Con?

What is interesting about Bitcoin is it has been a 'proof of concept' and the concept is now fundamentally proven. So what is next? As with the emergence of the WWW there was this 'eye of the storm' period when, for a while, the systems were in place and nothing much occurred. Then came the DOTCOM bubble. From the ashes today's enduring players arose: formed and consolidated. It appeared to me that nothing much was initially happening because nobody wanted to deal with companies and brands they had no historical knowledge of in the bricks-and-mortar world. Once these friendly faces emerged people went on-line and started shopping with them and soon also with a few notable internet born exceptions: Google, Facebook, Amazon and eBay.  I recall Amazon was 'the one' - the big newcomer ground breaker.

Bitcoin has been victim of its optimistic supporters in so much as people have speculatively invested in Bitcoins whereas that is not its real purpose. It is first and foremost supposed to be a means of exchange - that is its strength. But as a means of exchange it has not started to be truly useful. I cannot see making my larger payments say from UKP to JPY is really helped by using Bitcoin as the mechanism of transfer. It needs me to hold funds as Bitcoin and sellers to want to do the same and that is a long way off. It is an unknown and subject to sharp value fluctuations.

Now if the IMF came up with a son-of-Bitcoin that was indelibly tethered to their SDR basket of currencies the day of the digital coin would happen immediately. And if every major bank offered access to the same service too: people would start doing business. This I predict is what is going to happen.

Now all that is fine and dandy but the Bitcoin has one more feature that I presume could not be the case with an IMF-SDR digital-coin which is: Bitcoin is not a fiat currency - there is a finite volume of possible Bitcoin algorithms - so Bitcoin will tend to grow in value if and when its uptake becomes more prevalent - be pro-rata deflationary with growing usage.

The people who understand this make the bulk of the speculative investors today and they have at least 'keep the wheels on the wagon' to this point in time. Bitcoin's potential growth in value yet to come is roughly (optimistically) equated to the value of all the fiat money in the world today.

Will it happen. I think not. There may be a limited volume of Bitcoin's possible to produce but there is no limit to the introduction of other technically comparable digital-coins that could share the supposed same deflationary quality (limited volume). So the idea of a limited volume is not really correct.

I predict there is a place for Bitcoin as an early market leader, an established brand, but it will be joined by a plethora of digital-coins backed by known brands and entities, including maybe even digital versions of existing national currencies, a PayPalPunt, an AmazonAmericano, an AppleSeed and the soon to be popular RothschildRenminbi. The water could become very muddy.

The only survivor could be the 'block-chain' which manages the Bitcoin records amongst other tasks too. But since the block chain is the keys to recording every financial transaction conducted I am very doubtful of its continued independence. I think the UN will claim that crown as the corner-stone to its new global tax regime. Then we can start to understand what may lay behind this anonymous experiment as has been similarly suspected of apparent 'new start' IT providers throughout the history of the digital revolution.

See also: Forming the SDR Global Monitary & Political Union

Forming the SDR Global Monitary & Political Union

The drive toward a centrally issued single global currency appears to be a long desired outcome of the banking elites who substantially own, control and benefit from the central banking network about the world. 

As seen with the incantation of the EU, originally sold to the plebiscite as a trading union, the launch of the EURO single currency was widely understood to be unsustainable without the simultaneous total political and economic integration of the disparate independent nation member states.  This obviously intentional outcome was endlessly scoffed-at and robust derided but the conclusion, now it is upon us, is simple: the creation of the EURO was either implemented by utter ignorant fools or it was a covertly intentional device used to force the amalgamation of the independent European nations into a Greater Europe.

With Europe as the template moves are clearly under-way to enact the same set of circumstances in the forming of a North America political and monetary union and then undoubtedly further regional trade unions will be subjected to similar drives towards their forming political unions too.

It appears that simultaneous to that momentum the SDR mechanism will gain significance apparently with the objective of developing the SRD value into more than a IMF and central bankers device by allowing transactions to be conducted between parties in SDR values without need to exchange into any other of the root currency when making settlement.  No doubt when an SDR currency becomes established the demand will then be for, step two, the currencies included in the 'pot' to peg their individual rate to a given value.

The effect of this SDR based currency will be to draw the major currencies, and the separate sovereign economic states from which they emanate, into the same eventual and inevitable trap as that which the previously independent nation states of Europe were enticed.  So I conclude that it will be greatly as a result of this growing global monetary union from which a growing global economic and subsequently global political union will also be demanded and formed.

When rarely questioned, the political momentum behind this open conspiracy is justified and explained as the ambition to raise-up the poorer economies of nations across the world to parity and to bring about the end of war between separate sovereign nation states.  On the surface that may be so but at what cost?

The cost will be the lack of competition between states.  When each country has to vie in the 'market' against each other to offer the best environment for a flourishing social and economic condition, nations that make bad choices pay the price and learn from nations that do well and thrive.  People and business are drawn to the more liberal and successful nations leaving the tardy nations one simple option: change for the better.

The international central banking establishment is not the property of the nation states or their populous.  The mechanism behind the issue of money is the state-dependent corporate (read neo-feudal) and so clearly, at some level, all actually privately owned.  Issuing money is a vastly profitable enterprise and inflation adds a further cost to the use of money to the people who have it as any-sort of measure or store of wealth.

There is no better means for the enslavement of the people: all encompassing yet covert.  The banker's tribute is gathered by 'the state' by way of taxation to pay interest on debt and by way of the perpetuation of the system of 'the state' for their continued control and gain. Whilst money is monopolised in any way by 'the state' there will always be the propensity for this ultimate and fundamental tool to be usurped and used to profit against the interests of the population and for dictatorial control.