In my recent glowbass.com article, “The Shrinking Value of the U.S. Dollar” of February 11, 2011, I reported on the plans by the International Monetary Fund to create a new global currency interests called SDRs to replace the dollar as the world’s primary currency reserve.
Referring back to another IMF paper entitled, “Reserve Accumulation and International Monetary Stability, dated April 13, 2010, recommended that the IMF consider the adoption of a global currency called the “Bancor” to ultimately replace the U.S. dollar because of the enormous debt the U.S. has encumbered leading to the instability and weakness of the currency in global exchange.
From a historical perspective the word “Bancor” was first suggested by John Maynard Keynes back in the 1940s while he chaired the World Bank Commission as a potential global currency after World War II. Of course that never happened but soon it appears there are plans by the IMF and countries around the world to make it happen.
As the U.S. continues to mount huge deficits each day and that the government’s solution to the problem is the printing of fresh dollars, the dollar continues to decline in value. In 2010 the dollar declined about 11% and continues on a downward slide.
Most Americans don’t realize how important it is having the dollar as the global currency reserve…just consider the one primary factor, oil. Oil is now tied to the dollar…so when we pay for oil as a country all we have to do to keep up is to print more dollars. Since oil is such a key part of our economy, gas, plastics, chemicals, everything you can think of is based on the oil market. If the dollar is taken down as the global currency reserve as the IMF plans, the price of oil in dollars will increase substantially and most commodities, food, gas, cars, and electronics will also go sky high in this country. Inflation will be staggering if the IMF plan comes to fruition in the coming year(s). Chaos would result because the dollar would continue to decline and the average individual’s buying power will plummet.
Just ten years ago the dollar was still reasonably strong around the globe. Businesses would be happy to accept dollars instead of their national currencies because of the caveat strength of the money at the time. Now there are businesses in Mexico that won’t take a dollar in exchange for goods or services. One of the largest banks in Mexico, HSBC won’t let Americans open accounts or deposit dollars with the bank, ostensibly for drug related issues, but primarily because of the declining value of the once almighty buck. The same thing is happening in Europe and in other countries around the globe.
In a Massachusetts region the local community of Berkshire has created a local currency that is traded within the community called Berkshares. Apparently all a legal process since there is no law that prevents the development of another currency. Berkshares have been around for a few years and the people in the community trade them for food, services, and a variety of other exchanges. They created the Berkshare system because of the fear of the collapse of the dollar at some point in the future.
Maybe it’s time to create a similar program called Diegoshares in San Diego County. So, not, if, but when, the dollar is taken down and replaced by the Bancor internationally we’ll have something to buy food with in our local communities. Who knows, in the future we could trade Diegoshares for Berkshares to send our kids to universities in Massachusetts because it might remain a state where they still have good universities.
Look up your old world history books and study the fate of the Pound Sterling that was the world currency for decades until the end of World War II. Prior to that time people in the UK would have never thought that their mighty Pound would devalue to such a state. The same thing happened in old Czechoslovakia before the civil war there back in the 80s. Recently similar currency valuation problems have been replete in Greece, Ireland, Iceland, Spain, and Portugal.
America…history repeats itself, beware.
“Money alone sets the world in motion.” Maxim 656, Pubilius Syrus First Century B.C.