NEW WORLD CURRENCY
At the Breton Woods meetings of 1944, British Economist John Maynard Keynes recommended a new international currency, which he called the Bancor. Keynes proposed that the Bancor was to be fixed in terms of 30 commodities, of which one would be gold. The argument for currency fixed on a basket of commodities was that it would stabilize the average prices of commodities, and with them the international medium of exchange and a store of value.
Nevertheless, world currencies have been backed by less and less. In 1971, the US dollar was no longer backed by gold. The value of the dollar is now only 4 cents, compared to when the dollar was fully backed by gold in 1911.
The idea of a commodity-backed world currency has grown in favor. Currently, the Chinese have proposed a similar currency to the Bancor, again based on a basket of 30 commodities. The Russians and US Treasury Secretary Tim Geithner favor a currency they call Special Drawing Rights, which is based on a basket of four fiat (debt-based, unbacked) currencies.
Euro architect Bernard Lietaer has written about the value of having one or more complementary currencies, which balance the inherent Yang nature of the current debt-based monetary system. (See his books The Future of Money, summary here, and The Soul of Money (unpublished)). He created a model complementary currency, which he calls the Terra. Read about what a former Mitsubishi CEO says about the Terra here.
GGT proposes a currency similar to the Terra, but backed not only by commodities, but also by other value-producing projects. These could include mining, infrastructure development, and manufacturing. Declines in such sectors as manufacturing could be balanced by shifting the basket towards the commodity side.
Commodity-backed currency detractors have claimed that having a currency backed with gold would limit the growth of the economy. With an economy using a currency backed by a basket of commodities, this would no longer be a problem.
GGT further proposes that its own stocks might function as such a currency. Bearer stock certificates could be produced in the form of circulating notes. Gold and silver coins could even be produced, denominated in shares. Alternatively, perhaps local or regional currencies with intrinsic value, such as coins, would be designed to be exchanged for a designated number of shares. Banks might find that some of their customers preferred to save some of their wealth in the form of gold coin, and might choose to provide accounts denominated in these shares, much as a credit union values its assets and accounts in shares. As GGT assets increase, the ability to maintain a stable share value would increase, and this would make the shares more and more valuable for international commerce.
We at GGT are committed to this concept, and invite your input and ideas as to how to make this work.
