I’m posting an extract of my description of an interest-free money. It contains reference to “backing” by gold and the contractual obligations of participants. This is not quite as intended, the gold isn’t a “backing” it’s a “reserve”. Otherwise the following description is the plan I would like to see voluntarily adopted by those comprising the MaidSafe network. It follows that Safecoin and TelelinkGlobal’s NTC would be interchangeable but only within the closed community of TelelinkGlobal, not through an exchange but a communal marketplace.
The payments facility proposed to be managed by TelelinkGlobal resolves the problems identified by Dr. Zhou Xiaochuan, Professor Friedrich von Hayek, E. C. Riegel and Ludwig von Mises by providing a currency that is disconnected from individual nations and able to remain stable in the long run. The TelelinkGlobal currency unit serves all the various functions of money; viz. a medium of exchange, a unit of account and a store of value as well as an inexpensive secure means to switch from one to the other and which is interchangeable with fiat currencies and LGD gold. The TelelinkGlobal facility records transactions in approved legal tender denominations and the new global TelelinkGlobal digital currency. Eligible transactions for which the TelelinkGlobal currency facility is available as a medium of exchange are for trade in commodities, goods and services and as a store of value as hereinbefore described. The TelelinkGlobal currency used as a unit of account will provide a simple and more certain environment for global accounting than the International Financial Reporting Standards seem to be struggling to achieve with a multitude of fiat currencies. TelelinkGlobal currency facility is not and will not seek government privilege of “legal tender”. It is the property of everyone who chooses to be part of the TelelinkGlobal market economy.
The TelelinkGlobal trading platform is a “closed user” facility limited to recording trade in commodities, goods and services together with the resulting financial transactions and facilitating communication between members of the TelelinkGlobal community of buyers and sellers.
The fact that the value of the TelelinkGlobal currency unit is based entirely on trade in real commodities, goods and services and that trade in instruments of war, currencies, financial instruments and derivatives together with the proceeds of gaming and wagering are not eligible transactions for which the TelelinkGlobal currency is available is intended to remove the risk of speculative volatility and manipulation which the author reasons will far outweigh any inconvenience in ascertaining comparative market value of the TelelinkGlobal currency vis-à-vis legal tender.
Insert diagram of the TelelinkGlobal payments structure
Sellers can offer their wares for legal tender, nominated alternative currencies or TelelinkGlobal currency units or any mix thereof as a medium of exchange. TelelinkGlobal will not maintain bank accounts for payments in legal tender or alternative currencies by participants in its community of buyers and sellers as all transactions settled in legal tender and alternative currencies will be credited or debited, as the case may require, directly to the client’s account with its nominated financial institution in real time. Legal tender can be used to acquire LGD gold to pay for new issue TelelinkGlobal currency units. This facility is intended to provide participants in the TelelinkGlobal community of buyers and sellers with the means to switch from political fiat currencies and LGD gold into the fully-backed non-political TelelinkGlobal currency.
The means by which the TelelinkGlobal community of buyers and sellers propose to gain mastery of money by issuing their own currency are lawful and according to the best of the author’s knowledge and belief there are no legislative impediments. Here follows a description of the function of money, for our purposes expressed in the TelelinkGlobal currency as a medium of exchange:
(a) Money is a means of facilitating trade in commodities, goods and services listed on the TelelinkGlobal website by splitting transactions in halves, giving the buyer value and the seller a claim for equivalent value upon any one or more participants in the TelelinkGlobal community of buyers and sellers.
(b) The issuance of money arises out of a purchase and sale transaction requiring tender and acceptance. Therefore, it is a bi-lateral function that can be exerted only by a buyer and a seller and there can be no money issue on behalf of another - not by TelelinkGlobal, governments, persons engaged in the art of forgery or banks. If governments and banks have been accepted as participants in the TelelinkGlobal buying and selling community they can only issue TelelinkGlobal currency units on their own corporate accounts as a buyer and seller of real commodities, goods and services as defined herein along with all other buyers and sellers. TelelinkGlobal cannot issue unbacked TelelinkGlobal currency units to anyone, Governments cannot issue TelelinkGlobal currency units on behalf of their constituency, and nor can banks issue TelelinkGlobal currency units on behalf of their customers.
© Implicit in the act of issue is the mutual Agreement of the issuer who is the buyer (in common with all others in the community of buyers and sellers) to accept the issue of TelelinkGlobal currency units in exchange for value when tendered. Therefore, only one who is prepared to accept TelelinkGlobal currency units in exchange for value, when tendered, is qualified to be a money issuer and all persons so qualified to accept are ipso facto qualified to issue. Thus the power to issue TelelinkGlobal currency units is inherent in all buyers and sellers; and in some way or another we’re all both buyers and sellers.
(d) Money circulation is a cycle wherein the money passes from issuer (buyer) to acceptor (seller) and from acceptor to acceptor, until finally accepted by the issuer and thus retired. The money system is therefore nothing other than an elastic self-balancing arithmetical bookkeeping system recording split-barter transactions in TelelinkGlobal currency units from when they are created to when they are retired by an offsetting credit.
(e) The TelelinkGlobal currency unit evidencing the self-balancing bookkeeping process will have no intrinsic value or physical substance.
(f) The TelelinkGlobal currency is backed by the value surrendered by the seller and potentially backed by the value in possession of the next seller in the TelelinkGlobal community of buyers and sellers.
It is also necessary for TelelinkGlobal currency units and legal tender money to be exchangeable; also it would be appropriate to have the means whereby TelelinkGlobal currency units could be purchased for use within the TelelinkGlobal community of buyers and sellers. These functions are also lawful and according to the best of the author’s knowledge and belief there are no legislative impediments. Here follows a description of the means by which these functions are proposed to be achieved.
(a) TelelinkGlobal currency units may be offered and sold to anyone at any time provided:
i. both the buyer and the seller are participants in the TelelinkGlobal community of buyers and sellers; and
ii. the transaction is undertaken on the TelelinkGlobal website and recorded in its payments ledger; and
iii. the consideration for the sale is in the legal tender or fiat currency of the seller’s domicile.
(b) Participants in the TelelinkGlobal community of buyers and sellers may exchange TelelinkGlobal currency units at any time provided the transaction is undertaken on the TelelinkGlobal website and recorded in its payments ledger. Examples of these transactions include gifts, loyalty rewards, reimbursement of meal charges, event tickets and the like. Payment and receipt of the proceeds of betting and gaming are excluded.
© Participants in the TelelinkGlobal community of buyers and sellers may buy TelelinkGlobal currency units at market price through TelelinkGlobal with payment in LGD gold which is used as backing for new issue TelelinkGlobal currency units. All gold bullion is stored with one or more trusted agents of TelelinkGlobal account holders in the country of their domicile unless instructed otherwise by the account holder. The TelelinkGlobal currency units paid for in LGD gold rank pari passu with TelelinkGlobal currency units that have been created by the act of buying and selling including provision and use of the network computing facilities as recorded in the TelelinkGlobal ledger. TelelinkGlobal currency units are therefore backed by the current value of all LGD gold held by all trusted agents of the TelelinkGlobal account holders and 100% by the participants in the TelelinkGlobal community of buyers and sellers in accordance with the terms of their mutual Agreement.
(d) TelelinkGlobal will earn a small fee for activation and provision of each of its services - (Commerce, Currency and Communication) as provided to its community of buyers and sellers from time to time irrespective of the currency or method agreed between buyer and seller. Fees earned by TelelinkGlobal for such services paid in legal tender or fiat currency will be deposited in a TelelinkGlobal bank account and fees for services paid for with TelelinkGlobal currency units will be recorded in the TelelinkGlobal payments ledger debiting the payer and crediting the payee.
(e) TelelinkGlobal will never make a market in TelelinkGlobal currency units or permit others to do so.
(f) TelelinkGlobal currency units are worthless to any person who is not a member of the TelelinkGlobal community of buyers and sellers.
(g) There is no conceivable way in which TelelinkGlobal currency units could be issued more than once for the same transaction.
Here follows a description of TelelinkGlobal currency units functioning as a non-depreciating store of value and a unit of account.
(a) TelelinkGlobal currency units are disconnected from individual nations, free of debasement, speculation and manipulation by banks, governments and any other entity claiming authority or power over money.
(b) TelelinkGlobal currency units will be paired against the legal tender of each nation in which TelelinkGlobal establishes its business. Commencing (date to be named) the value of the TelelinkGlobal currency is deemed at par with the [Currency to be determined by the Board]. Thereafter the TelelinkGlobal currency units and any other currency approved by TelelinkGlobal are valued, not by the Foreign Exchange Market, but in accordance with the trading record of the TelelinkGlobal community of buyers and sellers.
© The TelelinkGlobal currency is valid only for trade in real commodities, goods and services which specifically excludes, inter alia, trade in instruments of war, currencies, derivatives and financial instruments together with transactions related to gambling and wagering. The practices of ‘making markets’ and ‘short selling’ are also forbidden.
(d) TelelinkGlobal will publish its daily assessments of the paired values of the TelelinkGlobal currency against other currencies (which may or may not be in accordance with the trading record of the TelelinkGlobal community of buyers and sellers) but TelelinkGlobal community of buyers and sellers are free to use any comparative or subjective valuation.
Advantages of a TelelinkGlobal Currency Vis-à-Vis National Fiat Currency
- Removes the power of government to inflate and otherwise manipulate the money supply which has been the cause of destabilising fluctuations of ‘trade cycles’ of booms, busts and depression.
- Places the control of money used for buying and selling real commodities, goods and services in the hands of the traders for use as a medium of exchange, a store of value and as a unit of account.
- Leaves governments and bankers to control and manipulate fiat money for their continued existence and trade in instruments of war, currencies and financial and instruments.
- Government and bank-issued fiat money would continue to be the accepted medium for money laundering, speculation, gambling, the conduct of war and crime.
- Money that people have been forced to accept, viz fiat is wholly different from money that has been accepted voluntarily! People will have trust in the voluntarily accepted TelelinkGlobal currency and because of its stability they will clearly see it is free of debasement and manipulation. Voluntarily accepted money therefore ought not to suffer from the evil reputation that governments and banks have given fiat money.
- Removes governments’ power to suppress individual liberty by its control of foreign exchange and inflation.
- Could provide all members of the European Economic Community with perhaps the only competitive solution to their respective problems of Euro imbalance in the Target2 facility and the improbability of successfully imposing a monetary union upon a group of sovereign nations. The indebted EU nations could restart and reinvigorate their industries utilising TelelinkGlobal currency and return the jobless to work while the Northern debt-free nations could trade their high value Euro currency for LGD gold and into TelelinkGlobal currency units. This solution would leave the banks, particularly the US banks, as the main losers, assuming it is banks that collectively hold the debt detailed in this chart; note that it omits China’s US$ 3.2 trillion trade surplus with USA and approximately US $10 trillion reserve currency that doesn’t show up in the US GAAP accounts.
- Germany should prod its Bundersbank to hasten its recovery of its gold from the USA; failure to achieve that objective presents a potential catastrophe.
- The fact that the value of the TelelinkGlobal currency unit will be established by its daily trading history in real commodities, goods and services and the value of LGD gold held in trust for the unit holders of the TelelinkGlobal Special Purposes Currency Trust will quickly define a pattern of its stability and strength when compared with any fiat currency in the World.
- When the world realises that the US dollar is worthless there’ll be massive capital flight out of US dollars as the currency is dumped. Those trade surplus nations, particularly China, Germany and Japan are well aware of the explanation by former top Barack Obama economic adviser Lawrence Summers when he recently dubbed the post GFC resilience of the US dollar as “a kind of balance of financial terror.” The implications of a collapse of the US dollar for China, Japan, Germany and the other trade surplus nations will not be easy for those nations to accept but doubtless they will have strategies for salvaging what they can from such a calamity. Meanwhile all these nations are moving away from use of the US dollar and into their own currencies for foreign trade which also has weaknesses as explained by Dr Zhou Xiaochuan in his 2009 essay Reform the International Monetary System. An early orderly move into TelelinkGlobal currency would minimise what will otherwise develop into a global financial catastrophe.
- American businesses should not support further bail-outs of the American banks; they’re rotten to the core. A transition by American businesses involved in trade in real commodities, goods and services to TelelinkGlobal currency would present their only safe haven and provide a foundation upon which they could rebuild their severely depleted manufacturing base and over time provide employment for the jobless millions.
- The sooner that there is effective separation of money and the state and the global frauds of fiat currencies, exchange control, legal tender, fractional reserve banking, fractional reserve trading of gold bullion, central banking and controlled inflation at 2% or thereabouts can be eliminated from society the less will be the pain from removing them later. By doing nothing will sooner or later return society to where we all came from.
- For the first time in history the peoples of every nation, irrespective as to their nationality, religion, race or political outlook will, by becoming a TelelinkGlobal account holder, have the opportunity to communicate, trade and exchange a common currency whether or not they have banking facilities or money, and that will include the other half the population of the world who are presently socially excluded.
- A TelelinkGlobal world-wide commerce, currency and communication facility will unify the peoples of the world on a fair and equitable economic basis. “New vistas of human advancement will open under the new order that will surely arise following the separation of money and state and the abandonment of the false political means in favor of the economic means of realizing social objectives”. [EC Riegel]