CIRI (China India Russia Iran) Avoids Dollar
The unbalanced advantages that the USA have/has out of the fact that the USD is still by far the biggest global reserve currency are huge:
It delivers the USA a limitless credit card on global energy, minerals and industrial production. It makes it possible for the USA to run a 75% (instead of 50% minus savings/pensions/investments so 37,5, the half of 75%) consumption based economy. It makes it possible for the USA to maintain >1000 military bases around the world and encircle and isolate any competitor they want to subject / dominate / tame / overpower / bring into submission.
It makes it possible for the USA to buy / corrupt any sign/manifest of national interest (as national interest of other nations is defacto against their global imperial interests, as they see the global economy as a zero sum model, which it isn’t, but as hegemonies unfortunately think in such a zero sum way). It makes it possible for the USA to go massive/voluminous short on any currency they want to bash as far as they want to bash it.
In the interests the monetary systems and economies of all other nations than the USA (and thereby of the global population) the dollar dominance should be ended. It delivers an one sided extra ordinarily set of advantages at the cost of anybody else that is out dated in the world of 2015. Since 1944 is has made deep marks into the global monetary system and thereby the global economy. Those in power of the USD can break of make nations at their will.
The fact that Iran / the CBI is cut of the SWIFT system, that they have tried to do the same with Russia / the CBR and they will try to do that somewhere in the near future with China / the PBOC (with by the USA ignited Xinjiang issues) as says enough. It’s their way or no way. Outside the monetary world the fact that monetary systems has so much impact on the economy somewhat forgotten.
The USA has/have not lived up to the standards it should be live up to as the sole hegemonic power it was since 1989. To go further: very soon after the USD system in 1944 was installed the leadership derailed. Having by far the most important global reserve currency is too much responsibility for any nation to bear: delivering one nations such an advantage is asking for / ordering troubles and misbehaviour.
It’s time to stop the monetary dominance of the USA by the USD: it not only gives them a free ride on the global economy, it delivers them also the possibility to ‘jail’ any nation of the world without any evidence let alone any objective public trial. It’s time to ‘jail break’ out of this very unfair USD powered global submission system. Time to stop paying for the own jailing (which is what using the USD basically is). Less risks, more security, not only national, nor only economic, but also and foremost monetary. It’s time that other nations will have a fair playing field with the USA.
How to do that? How to realize in short time a monetary world where the USD has not the big role it had before and therefore the USA has no leverage on global monetary systems, on global economic systems, on global political systems and on global military systems. And even more important: how to do that in a peaceful way that doesn’t backfire.
Simply by doing international business in your own currency. When this is done, the USA can’t ‘tax’ the transactions any more (i.e. can’t profit of it anymore) by the USD demand that it would generate if the business was done in USD. Your economy and monetary system is pulled out of the USA sphere of influence/power (making or breaking) and therefore also out of their ‘global taxation by the USD’. Simply by stimulating that international business is done in your own currency the grip of the USA on the world (which is quite arsenic since 2001: they have become the hooligans of the world, economic, political and military, openly -Iraq, Libya, etc- or semi-stealth by proxy -Syria, Ukraine, etc-) will be sized down instantly and effective.
How to realize a quick but stable riskless transition away from the dollar for international transactions towards using the own currency for international transactions?
We as Planck Foundation think there a need for a brand new global structure that is not based on the dominance of one nation, nor wants to have any influence on other nations. An organization that respects sovereign nations (as that has flushed away since 2001) and concentrates/facilitates only on bilateral monetary and trade deals. A structure where central banks can negotiated BCS (bilateral currency swaps) with each other based on BQE/TQE (bilateral QE / trade QE). A structure where nations can negotiate BTA (bilateral trade agreements). BQE/TQE is non-toxic: as it is in balance on both sides it delivers no inflation. BQE/TQE also widens and diversifies national economies: making them bigger and stronger. Which delivers both a) more monetary health/power for the central banks and b) increases the tax base for governments.
If one thing will become clear very soon is that the USA driven/pushed global deals or huge multilateral regional deals are not the future central banks and nations wants to move into. Bilateral will become the word for a peer2peer ‘mutual interests’ based setting. Trade agreements like TPP and TTIP will not fly that good, but isolate the signatories and make them clients of a USA centred patent system (even for their food: TPP and TTIP is very much on US patents and more specific: on US food crop DNA patents). The real nature of TPP and TTIP is not that good/widely understood: it’s not about free trade, it’s about maintaining a system of ‘free’ trade for those who have already the upper hand. TPP and TTIP is mainly about trojaning the own legal system of nations for large US patent owners and by that creating a new economic/monetary drain towards the USA to replace the USD dominance driven economic/monetary drain (as they see that the role of the dollar is played out soon).
What’s needed is a real round table model structure that just facilitates both bilateral central bank deals and bilateral government deals. With no leadership of one single nation, with no unilateral benefits for one nation at the cost of other nations. A round table model where central banks and nations can make deals with their peers in their own interest based on mutual interests and facilitates both the making of these deals and delivers central banks the tools to prevent abuse of the BQE/TQE. A non-imperial model, a model based on sovereign nations and sovereign central banks. No overhead management, no masters: just facilitating (i.e. making it easy) to make such deals with as many nations as wanted. Serving, not ruling.
Such a model is developed with Planck Foundation. It’s an open model that central banks can use towards their own national retail banks that finance the export transactions. It not only will make the economy solid/healthy, it will make the financial system also more solid/healthy. It will deliver a market drive wealth multiplying and distribution by fair/healthy markets type of what we call productive capitalism, instead of letting the rather parasitic of the real economy feeding Anglo American financial capitalism based model.
It will instantly start to out phase the whole 1944 based and by changing realities/performance totally outdated global structures that where designed for delivering the USA special benefits at the cost of the rest. It also will deliver global peace (as trade grows mutual interests against war mongering and thereby limits the appetite for war in all nations). Plus it will boost the economic growth of the emerging world scrapping the parasitic models of the old powers and delivering huge export markets. Also it will deliver more FX stability.
This things start at central bank level. The next step would be to convincing the political leadership, but that will be very easy: they all are longing for more exports and stable currency values. The central banks have by BCS (BQE/TQE) the keys to global prosperity in the 21st century. If they consult each other on this, is the rest 'downhill' (easy), as we at Planck Foundation know a) how to realize this (fast and solid) and b) how to do that in a smooth non offensive towards the USA way (as rubbing salt in open wounds is never wise to do).
When all 4 CIRI nations will go for this monetary (and therefore also economic) bilateral facilitating model, the rest of the Global East and Global South will join in no-time. And Europe would have to chose if they want healthy bilateral relations or stay an US proxy colony. I think the ECB (BQE/TQE) and the EC (BTA) will join and all European nations will follow them soon after.
It will change the monetary world once and for all, and by that the economic world and by that the relations sovereign nations will have and by that the life of mankind. It’s this way or the US will succeed in a global reboot of the financial system under their management so that the world would cater their demands for yet another 70 years (see http://www.planck.org/publications/Global-West-Common-Currency-Union or the other papers on this topic we made).
Let’s replace the rather weird American Century model of PNAC (http://en.wikipedia.org/wiki/Project_for_the_New_American_Century) with a stable and fair global century model where sovereign nations and bilaterals will become the mainstream development. Let’s replace the American Century with a Global Century without the one nation leadership that PNAC till today: PNAC’s Victoria Nuland is the main actor in Ukraine: google her and PNAC: you will see that the world hasn’t changed and that those who steered Bush/Cheney/Blair still are calling the shots in the main global events: labelling legitimate governments ‘regimes’ and destabilize any government that doesn’t cater the USD monetary hegemony. Solving this ongoing huge and getting more intense turbulence is as easy as bypassing the USD.
Create such a mutual interests driven monetary model is wise. No more one nation dominated imperial global monetary system that tax the wealth of real economic production of other nations by monetary means. It’s not hard to do that and the effect is guaranteed: just bypass the USD in a way described above. It can be done by making just a simple choice to realize it. We at Planck Foundation know how to facilitate a quick roll-out of this new distributed monetary power model. It’s the moment to do it. Governors of central banks should talk with each other on this, and if they meet peers: they should make the choice to do it.
As conclusion it's good to quote Stiglitz from a syndicated article that is published widely (for example on http://www.vanityfair.com/business/2015/01/china-worlds-largest-economy):
“The United States then made two critical mistakes. First, it inferred that its triumph meant a triumph for everything it stood for. But in much of the Third World, concerns about poverty—and the economic rights that had long been advocated by the left—remained paramount. The second mistake was to use the short period of its unilateral dominance, between the fall of the Berlin Wall and the fall of Lehman Brothers, to pursue its own narrow economic interests—or, more accurately, the economic interests of its multi-nationals, including its big banks—rather than to create a new, stable world order. The trade regime the U.S. pushed through in 1994, creating the World Trade Organization, was so unbalanced that, five years later, when another trade agreement was in the offing, the prospect led to riots in Seattle. Talking about free and fair trade, while insisting (for instance) on subsidies for its rich farmers, has cast the U.S. as hypocritical and self-serving.”
See also International Currency Stability
See also Europe: Diagnosis and Prescription
See also Governmental Funding Turbulence
See also Labour Taxation
See also Money Creation
See also Energy Open Finance Platform
See also Global PV Solar Energy Finance Model
See also EQE/EBS Model Summary Diagram
See also BQE: Bilateral Currency Swaps
See also Gold Backing vs EQE/EBS Backing
See also Secular Stagnation as Denial Term
See also Financial QE vs Productive QE
See also Productive Capitalism Perspectives
See also Emerging Nations - Electricity PPP
See also Emerging Nations - Solar PPP
See also Easy Instant Solarizing Nations
See also Making The Euro More Offensive
See also Structural EU/EC Boat Refugees Solution
See also Global Solar Rollout - Description - Diagram
See also Regional Solar Rollout - Description - Diagram
See also Obama Administration Energy Strategy
See also China As Global Leading Solar Energy Nation
See also Open Finance Platform for Energy Investments
See also Iceland 3.0: Geothermal and Energy as Currency
See also Addressing Economic Decline of the Global West
See also IntraContinental: Continental Rail Schedules
See also Global West Enters Economic Adulthood
See also Global East Driven Globalization 2.0
See also Financial Capitalism vs Productive Capitalism
See also CIRI (China India Russia Iran) Avoids Dollar
See also Global West Gets A Common Currency
See also What Ended Global West Dominance
See also National Economic Development Organizations
See also Desert Investment Economics
See also Ending Global Poverty (By Sea Water Irrigation)
See also Global Deserts Exploration Model
See also WaterTech and MicroCredit Merge
See also Lupin As Soy Replacer
See also Global Seed Cartels Aren't Right
See also Global Food Model: Local to Global
See also Sun / Earth Interactions
See also Telco 3.0 : Telco out of the Cloud
See also National Business Clusters Abroad
See also Scientific Education/Research Funding
See also Iran: National Economic Plan
See also Immigrants and Trade
See also Emerging Nations - Minerals PPP
See also Emerging Nations - Deserts PPP
See also Emerging Nations - Energy PPP
See also National Solar Fund Model
See also Secular Islamic Finance
See also Open Energy Finance Platform
Gijs Graafland / Planck Foundation / Amsterdam / 2015
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