An idiotic view of banking

I know very little about world finance, but that doesn’t stop me worrying when I see the rate at which unemployment is rising, through nothing more nor less than greed and incompetence. So I sat down yesterday and thought about possible changes in the way the world’s banking was operated. I have said before that currency is purely a convenient commodity to permit payment for services rendered, but the problem is that there is not a stable value against which all currencies can be viewed, because different currencies are bought and sold like commodities. It then occurred to me that in effect we have two forms of currency. There is the internal currency that each country uses for barter within that country. Then there are the money markets buying and selling these currencies and so allowing individuals or companies to make money. I may be an idiot, but it occurred to me that we should have an international currency that has a fixed value that never changes, what it is related to is a matter of choice, but it must be inviolate and totally stable. The same applies to the National currencies only their value would be related to the international currency.

The value of a commodity produced by a factory or sold in a shop is what the market will stand, and so the value of the commodity should be the thing that varies, not the currency. If this were the case, and the currency was stable, then we wouldn’t be in the plight we are today. There would not be any money markets, each country would only use its currency within its borders, and in any transaction outside its borders would be carried on in the international currency. The only sticking point is determining the value of the international currency and making sure that its intrinsic value never changed with time.

These last statements point to the fact that all we need is an international currency which is set in some way so its value never varies with time, rather like the metre and international measurement.

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