Is a sound money bank on the horizon? Part 1.

 ALL CENTRAL BANKS ARE USING FIAT CURRENCY

A SOUND MONEY BANK WOULD END INFLATION 

At present every central bank in the world is engaged in a fiat currency system, a currency that has no asset backing. At one time all paper currency was backed by gold or silver and the paper was in effect a receipt and exchangeable for this real asset of gold or silver. Fiat currency allows every nation to print and spend money that is not really an asset, but an instrument of debt by the government.

This transformation was accomplished over a period of decades, the backing of currency in the United States ended in 1971.  This allows governments to spend beyond their means and results in inflation or the devaluation of their currency. This has been sustainable because they are all doing it and only the worst players are punished. The average citizen and saver is the victim of this, in reality, fraud. Those who speculate in money and debt and paper transactions are the winners. The world is awash in debt levels, unprecedented in human history. The United States federal government alone has a debt of $35 trillion and the interest is now $1 trillion a year. It continues to grow in good times and bad.

There are signs that this may be about to change in the not too distant future. If there was a sound money bank, it would eventually cause all banks to adjust to compete with such a bank. It would force them all to become much more responsible and honest.

Such a bank could be established by the western nations, but we can expect they will fight the existence of such a bank, with all their power, as the present system allows them to engage in this fraud and use it as weapon on whoever they choose.

So, is it possible to establish such a bank? If It is possible, how would such a bank be organized and maintained. 

At present many nations are engaged in forming an economic system separate and free from the western banks. They are now using their currencies to trade with each other rather than the dollar and the euro. They are establishing an international payment system that will run alongside the present system. They are intent on replacing the dollar as the world's reserve currency, at least for those who choose to do so, but have not yet established such a currency. They are transparent in proclaiming that they do not want any one country to have control of a reserve currency. So how would a sound money bank, available for every nation and every citizen to participate in, look like.

We will look a possible blueprint for just such a bank tomorrow in part 2.