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© DenkManufaktur AG, Schliersee / Bavaria: Any use of this material is very much appreciated!
Practical Monetary Reform experienceand insights into a possible Greek solution by Michael Dürr
www.denkman.com
Conference - „The Future of Money: What does the evidence teach.“Athens University of Economics and Business - Executive MBA & International MBA, January 24th 2013
© DenkManufaktur AG, Schliersee / Germany
Today´s Discussion
denkmanufaktur.net I 1
Transition agenda to get rid of the Greek odious debt situation and to restore democracy from debtocracy!
The Future of Money and it´s transformation by an activist central bank shareholder
Practical monetary reform experience in South Africa: transformation through the nationalisation of money - JUST MONEY proposal
Isolated island money reform: transformation in the Seychelles – JUST MONEY proposal thwarted by the IMF
Insights and a possible transformation in Greece -nationalised legal tender creation and the freedom of currencies
Alternative (complementary) currency blessing for Greece
JUSTMONEY
One solution: Bank of Greece – takeover or liquidation
First they ignore you, then they laugh at you, then they fight you, then you win. Describing the stages of a winning strategy of nonviolent
activism.
Alternative (complementary) currency blessing for Greece
Source: DenkManufaktur AG - Research, Analysis, Insights denkmanufaktur.net I 2
is guaranteed by the nationalisation of the creation of money
The Future of Money ...
dated March 1935 was the 20th century guideline for the Future of Money: safe money, smoothed business-cycles, controlled inflation, seignorage in the public purse, public debt redeemed.
JUSTMONEY
Although academic results from Irving Fisher et al. are still valid, those findings had to be adapted to the 21st century and the necessities of electronic money. This is one possiblity:
Source: DenkManufaktur AG – Vorsprung durch Denken denkmanufaktur.net I 3
Leverage of ownership in a 100% privately owned central bank of a G20 country
... and the transformation by an activist central bank shareholder – part 1
JUSTMONEY
Own a central bank and have your say!
Source: DenkManufaktur AG – Your Global Think Authority denkmanufaktur.net I 4
Shareholders should ideally enhance the independence of the Reserve Bank
... and the transformation by an activist central bank shareholder – part 2
JUSTMONEY
Source: DenkManufaktur AG - Research, Analysis, Insights denkmanufaktur.net I 5
Declare Money Supply M1 (means-of-payment) as sole legal tender
... and the transformation by nationalisationJUSTMONEY
19th century: nationalisation of coins
21st century: nationalisation of electronic money
20th century: nationalisation of banknotes
History and future of phasing out privately issued money in favour of public money
Bundesbank Act (latest version as amended on December 22nd 2011)
Systematic risk today: only banknotes are sole unrestricted legal tender
© DenkManufaktur AG - Vorsprung durch Denken
Today´s Discussion
denkmanufaktur.net I 6
„The Government should create, issue, and circulate all the currency and credits needed to satisfy the spending power of the Government and the buying power of consumers. By the adoption of these principles, the taxpayer will be saved immense sums of interest. Money will cease to be master and become the servant of humanity.“ (Abraham Lincoln)
The Future of Money and it´s transformation by an activist central bank shareholder
Practical monetary reform experience in South Africa: transformation through the nationalisation of money - JUST MONEY proposal
Isolated island money reform: transformation in the Seychelles – JUST MONEY proposal thwarted by the IMF
Insights and a possible transformation in Greece -nationalised legal tender creation and the freedom of currencies
Alternative (complementary) currency blessing for Greece
JUSTMONEY
One solution: Bank of Greece – takeover or liquidation
Source: DenkManufaktur AG - Research, Analysis, Insights denkmanufaktur.net I 7
Transformation through an instant 100% minimum reserve requirement
Practical monetary reform experience in South Africa:
Two shareholders of the South African Reserve Bank meet the President: he wants to understand and change (December 1st 2009)
Source: DenkManufaktur AG – Your Global Think Authority denkmanufaktur.net I 8
The lessons learnt from this 6 year fight are helpful for a Greek solution
… and the subsequent problems in the transformation
The banking lobby (oligopoly) defends its turf and hits back: through the media, the Treasury and the Reserve Bank – even an agreement with the President gets vaporised
© DenkManufaktur AG, Schliersee / Germany
Today´s Discussion
denkmanufaktur.net I 9
„The issue of currency should be lodged with the government and be protected from domination by Wall Street“ (Theodore Roosevelt)
The Future of Money and it´s transformation by an activist central bank shareholder
Practical monetary reform experience in South Africa: transformation through the nationalisation of money - JUST MONEY proposal
Isolated island money reform: transformation in the Seychelles – JUST MONEY proposal thwarted by the IMF
Insights and a possible transformation in Greece -nationalised legal tender creation and the freedom of currencies
Alternative (complementary) currency blessing for Greece
JUSTMONEY
One solution: Bank of Greece – takeover or liquidation
Source: DenkManufaktur AG - Research, Analysis, Insights denkmanufaktur.net I 10
JUST MONEY in competition to a Paris Club Agreement and the IMF
The isolated island money reform transformation in the Seychelles
Source: DenkManufaktur AG - Vorsprung durch Denken denkmanufaktur.net I 11
Now the Club (IMF, BIS, IIF, etc.) allows false flag operations to see the light of day
… JUST MONEY proposal thwarted by the IMF
The banking lobby (IMF) defends its turf and hits back: the lessons the IMF learnt due to the monetary reform evolution worldwide and the proposals presented in various countries
© DenkManufaktur AG, Schliersee / Germany
Today´s Discussion
denkmanufaktur.net I 12
„If Congress has the right under the Constitution to issue paper money, it was given to be used by themselves, not to be delegated to individuals or corporations“ (Andrew Jackson)
The Future of Money and it´s transformation by an activist central bank shareholder
Practical monetary reform experience in South Africa: transformation through the nationalisation of money - JUST MONEY proposal
Isolated island money reform: transformation in the Seychelles – JUST MONEY proposal thwarted by the IMF
Insights and a possible transformation in Greece -nationalised legal tender creation and the freedom of currencies
Alternative (complementary) currency blessing for Greece
JUSTMONEY
One solution: Bank of Greece – takeover or liquidation
Source: DenkManufaktur AG - Research, Analysis, Insights denkmanufaktur.net I 13
The basis for a Greek monetary reform revolution is present and well informed
Insights and a possible transformation in Greece
The next documentary in 2013: 100% Money (aka Vollgeld, Just Money, Positive Money, The Chicago Plan Revisited, etc.)
2011: www.debtocracy.gr
2012: www.catastroika.com
> 2 millionviewers
?
Source: DenkManufaktur AG – Your Global Think Authority denkmanufaktur.net I 14
A probable bank panic is when many commercial banks suffer runs
… a possible transformation: The Bank Run
Problems of the current and faulty fractional-reserve banking system
Minimum Reserve Requirements only 1%Deposit Insurance systems are a myth
Self-fulfilling prophecy when a bank run startsCurrent proposal by MoF to reduce cash payments to Euro 500 maximum
MoF plans to incentivise electronic payments in 2013
Banknotes in circulation (31.12.2012): Euro 23.576 billion
Greek population: 11.3 million
Euro banknotes per Greek citizen: Euro 2,086
Contingency cash available at any given time calculated by Bundesbank figures: 10-15%http://www.bundesbank.de/Redaktion/EN/Downloads/Publications/Monthly_Report/2011/2011_01_monthly_report.pdf?__blob=publicationFile(Monthly Report January 2011 - pages 29 to 41: Foreign demand for euro banknotes issued in Germany)
Contingency banknotes per
Greek citizen (using Bundesbank data):
Euro 210 to 315 per person
MORALHAZARD(excerpt: Wikipedia)
Source: DenkManufaktur AG - Research, Analysis, Insights denkmanufaktur.net I 15
„It may not be rational to start a bank run, but it is rational to participate in one“ (Sir Mervyn King, Governor Bank of England)
… „The only way to stop a eurozone bank run“
„Case for a bloc-wide deposit insurance and bank resolution regime“ – this will not work
Source: DenkManufaktur AG - Vorsprung durch Denken denkmanufaktur.net I 16
Transformation with the support of a Greek version of 100% (Just) Money makes bank runs / panic obsolete
… nationalised legal tender creation and the freedom of new currencies
Nationalisation of toxic / problem assets or bad banks sell-by-date expired!
Nationalisation of the creation of money with a simultaneous introduction of free alternative / complementary currencies is the only way forward!
Local markets will determine the best solution to fit the Greek society and economy!
Monetary Diversity is the name of the game – variety is healthier and more stable!
Source: DenkManufaktur AG - Research, Analysis, Insights denkmanufaktur.net I 17
Transition will be achieved through the right leverage and fulcrum
… use the ODIOUS DEBT situation - copy Correa style or create Venizelism 2.0
Odious Debt in the 21st century: from debtocracy back to democracy
Odious - when it is without knowledge of and benefit to the people plus lender knows about it
Use the illegality and illegitimacy of most of the debt due to the fact that it is odious
Create an audit committee to evaluate what debt is odious and what will be accepted
Use the examples and results from Argentine and Ecuador to learn for Greece
Support a Greek Rafael Correa: „boot the henchmen from the zombie institutions like the IMF“
Use the „Chopper“ as a symbol: Greece most recently got new helicopters anyway – on debt
Stop Merkiavelli, the Hellenic Republic Asset Development Fund and the Reichenbach task force
Give them a run for their debt money created by the MFIs, based on the fractional-reserve scheme
Venizelism 2.0: respect the law and use it against the plutocracy
© DenkManufaktur AG – Your Global Think Authority
Today´s Discussion
denkmanufaktur.net I 18
„History records that the money-changers have used every form of abuse, intrigue, deceit, and violent means possible to maintain their control over governments by controlling money and its issuance“(James Madison)
The Future of Money and it´s transformation by an activist central bank shareholder
Practical monetary reform experience in South Africa: transformation through the nationalisation of money - JUST MONEY proposal
Isolated island money reform: transformation in the Seychelles – JUST MONEY proposal thwarted by the IMF
Insights and a possible transformation in Greece -nationalised legal tender creation and the freedom of currencies
Alternative (complementary) currency blessing for Greece
JUSTMONEY
One solution: Bank of Greece – takeover or liquidation
Source: DenkManufaktur AG - Research, Analysis, Insights denkmanufaktur.net I 19
Swiss cooperative WIR Bank as a model case for one electronic barter system
Alternative (complementary) currency blessing for Greece
Founded in 1934 by 16 people as a cooperative basedon the system developed by JAK in Denmark 1931
Pioneer phase until 1952Demurrage (Silvio Gesell) until 1958
Growth phase until 1988
Innovation phase until today:
Membership 70,000 companies and since 1997 open to the public
WIR (since 2004 with ISO 4217 code: CHW)is not covered by the Swiss Franc (ISO code: CHF)
Immediate implementation by one of the 12 Greek coop banks (which comprise 40% of Greek banks)
www.wir.ch is only one example of an alternative currency to be copied
© DenkManufaktur AG - Vorsprung durch Denken
Today´s Discussion
denkmanufaktur.net I 20
„I am a most unhappy man. I have unwittingly ruined my country. A great industrial nation is controlled by its system of credit“ (Woodrow Wilson)
The Future of Money and it´s transformation by an activist central bank shareholder
Practical monetary reform experience in South Africa: transformation through the nationalisation of money - JUST MONEY proposal
Isolated island money reform: transformation in the Seychelles – JUST MONEY proposal thwarted by the IMF
Insights and a possible transformation in Greece -nationalised legal tender creation and the freedom of currencies
Alternative (complementary) currency blessing for Greece
JUSTMONEY
One solution: Bank of Greece – takeover or liquidation
Source: DenkManufaktur AG - Research, Analysis, Insights denkmanufaktur.net I 21
One step for a Greek monetary reform revolution is getting a BoG shareholder
One solution: Bank of Greece – takeover or liquidation
Buy into the system and fight it as a shareholder:Bank of Greece shares → ISIN: GRS004013009
A takeover or liquidation of the Bank of Greece, listed at the Athens Stock Exchange, is theoretical, but the leverage and fulcrum of being a central bank shareholder is enormous.
75 shares grant one vote. The „Have a Say“ in your central bank would cost Euro 1,300. The AGM of BoG owners will be held on February 25th (shares to be registered 5 days before).
This will be a great short term opportunity and contribution for a Greek citizen to change the course of events, create more awareness and to personally vote for a money reform.
It will be a life-changing practical experience and one would gain first hand insights in the inner workings of a major puzzle piece in solving the Greek dilemma.
And the best of all, over the last month one would have made a profit of 35%.(share price at January 22nd 2013: Euro 17.45 compared to Euro 12.9 at December 21st 2012)
Source: DenkManufaktur AG - Research, Analysis, Insights denkmanufaktur.net I 22
Takeover by the state or liquidation due to bankruptcy is part of the solution!
… this may seem unreal, but there is a logic behind it!
At its meeting on 21 January 2013, the General Council of the Bank of Greece approved the Bank’s audited Annual Accounts for the financial year ending 31 December 2012.
© DenkManufaktur AG, Schliersee / Germany
The End of Today´s Discussion -> Conclusions
denkmanufaktur.net I 23
„First they ignore you, then they laugh at you, then they fight you, then you win.“
100% (Just) Money will replace the fractional-reserve banking system
Alternative & complementary currencies will be allowed unconditional
Nationalisation of means-of-payment is a prerogative like coins and notes
Transformation is the most important issue – the academic base is sound
Greece is ripe for the monetary reform revolution needed for the change
Practical experience has to be used to avoid further ambush by MFIs
Greek transformation through a bank run or a bank panic very likely
Greek transformation through an activist shareholder approach (BoG)
Greek people have to take the pride back they deserve, get rid of the odious debt, free themselves from the shackle of the current system, create a debt- and interest-free currency, which can flow into the economy through public expenditure, avoid direct taxation and much more!
© DenkManufaktur AG, Schliersee / Bavaria: Any use of this material is very much appreciated!
Practical Monetary Reform experienceand insights into a possible Greek solution by Michael Dürr ([email protected])
www.denkman.com
Conference - „The Future of Money: What does the evidence teach.“Athens University of Economics and Business - Executive MBA & International MBA, January 24th 2013
Thank
you