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WORLD ORDER OF NON-CREDIT MONEY |
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Autor Mika
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Monday, 21 July 2008 |
Money available in a society often changes hands, passes from owner to owner and from account to account. It is used to sell and buy goods and services, as well as to make other transactions. It constitutes the quantity of money in circulation. The quotient of value of national product (PQ) made in a year and quantity of money in circulation (M) is called an average velocity of money circulation (V).
It has been noticed that with the development of a society the ratio between national product obtained and quantity of money in circulation decrease, i.e. velocity of money circulation decreases. In order to maintain the obtained level of production an additional quantity of money in circulation is needed, in order to compensate the shortage of money causes by retarded velocity of money circulation.
It is even more clearly obvious that, with the development of a society, both production and value of national product increase, and to obtain these an additional quantity of money in circulation is obviously needed.
If because of an increase in production it is necessary to increase the existing quantity of money in circulation for 2 % and because of retarded velocity of money circulation only for 1 %, a total increase in quantity of money in circulation must be 3 %.
The most famous monetary expert of 20 –th century, Milton Friedman, who, by studying statistical data of various countries, but primarily of USA, has found out a universal retarding of velocity of money circulation, has also found out that measures of monetary policy are most often counterproductive, first of all because of delay in the effects of monetary-political measures.
Milton Friedman has concluded that the best environment for spontaneous development of economic activities would be the one where the quantity of money in circulation would increase at constant annual rate of 2% or 5%, by which the negative effects of alternate, expansive and restrictive, monetary shocks would be avoided.
It can be clearly seen that the designed and emitted, existing quantity of money is always insufficient, and new and new, additional money emission is always needed, in order to keep the economic mechanism moving. In a society there is always the problem of money shortage, the problem of deflation. This problem originates from the very nature, essence of money, as it is understood today.
Since men have been making paper money, it has become a habit to put such a kind of money into circulation in the form of credits. It was thought that a coverage for such money was secured in human labors. To return the debt, debtors had to produce and sell something.
However, due to retarding of velocity of money circulation, shortage of money was experienced, demand was in decrease, the unsold goods piled up, unemployment was in increase, as well as idleness of capacities. During Great World Economic Crisis USA lacked more than 30% of the quantity of money in circulation.
Due to retarding of velocity of money circulation, credits cannot be returned from the existing quantity of money. An additional quantity of money is needed, and it is also given in the form of credits. Credit obligations increase and they are more and more difficult to fulfill. A constantly increasing indebtedness exceeds by far the value of production. An endless inflation of credit money occurs, the quantity of money constantly increasing but never being sufficient to overcome the existing deflation.
If a country put into circulation the necessary additional amount of money as non-credit money, i.e. as gift, without the obligation to return it, the process would be stopped. The inflation would disappear. It would soon be visible how the value of that country money rises in relation to US dollar and other currencies.
The rulers of the world like to rule the world by making decisions of how to distribute credits. That is why they did not look benevolently at attempts of some countries to free themselves of debtor slavery.
The rule over the world, by deciding how to distribute the quotas of non-credit money, arising from the development of world trade and economic rationality, will be no less interesting a job.
The share of a particular country in distribution of the world non-credit money will determine its position in the world exchange, its capability to export and import. By approving a particular quota of non-credit money the international community will prove the level of its willingness to help a particular country and nation. The growth of world trade will be stimulated.
Within a country non-credit money will be distributed to non-producers, and demand of non-producers and producers` profits will be increased.
The world order of non-credit money will be established when everybody realizes that it is in everybody interest.Nema komentara na ovaj tekst |
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