11. Countdown...The Global Monetary System.
Entry posted by Marilyn C
373 views
The Global Monetary System.
Recapping - After WW2 many countries came together and established some International Forums and institutions that would eventually be the infrastructure of a Global Government. These are - the G 7, G 20, the IMF, (International Monetary Fund) plus others.
Meanwhile the American dollar was made the Lender of last resort with all countries using it for their trade. Thus great reserves were kept in various nations. America backed its dollar by gold and would exchange nation`s dollars for gold if they so desired.
Then America got involved in the Vietnam War and began printing vast amounts of dollars. Some nations cashed in their dollars for gold until (President) Nixon put a halt to it as it was draining the countries reserves. Thus the dollar was only held by trust.
Over the years this has led to bubbles, crashes and swings in different nation`s currency values. Thus nations have sought for another currency to provide stability to the Global Monetary System.
The IMF`s main purposes were to `foster global monetary cooperation, and secure financial stability, as well as reduce poverty around the world.` They were empowered with SDR`s (Special Drawing Rights) that enabled the members to borrow or exchange currencies. The main members were the four industrial nations - Britain, USA, Europe & Japan. Recently China has been included.
Then over the past 10 years the IMF has proceeded to include many more countries as members and to hold SDR`s. As different crisis occurred the IMF was instrumental in helping to refinance many nations. Now with the corona virus Pandemic and the economic fallout the IMF will play a very significant role.
The poorer nations of the world have been greatly affected and will be given great emergency relief by the IMF. There will also be a suspension of debts repayments - a ground breaking accord from among the G20 countries.
As more and more nations are included to receive the IMF`s SDR`s in exchange for their dollars, then a big reset of currencies will occur. The main currency then to be used by governments, banks and corporations will be the SDR`s.
The nation`s own currency will go into inflation and be of less value. Eventually the IMF will issue the digital `Bancor` (IMF currency) and that will be used by the general public. People will desire to use the digital Bancor as it has a Global backing. All other currencies will cease to be used.
Note: Using the SDR`s will involve adherence to the Climate Change rules & regulations.
8 Comments
Recommended Comments