Monetary reform

Monetary reform is any movement or theory that proposes a system of supplying money and financing the economy that is different from the current system.[1]

Monetary reformers may advocate any of the following, among other proposals:

  • The issuance of interest-free credit by a government-controlled and fully owned central bank. Such interest-free but repayable loans could be used for public infrastructure and productive private investment. This proposal seeks to avoid debt-free money causing inflation.[9][10][11]
  • The issuance of social credit – "debt-free" or "pure" money issued directly from the Treasury – rather than the sourcing of fresh money from a central bank in the form of interest-bearing bonds. These direct cash payments would be made to "replenish" or compensate people for the net losses some monetary reformers believe they suffer in a fractional reserve-based monetary system.[12][13]

Common targets for reform

Of all the aspects of monetary policy, certain topics reoccur as targets for reform:

Reserve requirements

Banks typically make loans to customers by crediting new demand deposits to the account of the customer. This practice, which is known as fractional reserve banking, permits the total supply of credit to exceed the liquid legal reserves of the bank. The amount of this excess is expressed as the "reserve ratio" and is limited by government regulators not to exceed a level which they deem adequate to ensure the ability of banks to meet their payment obligations. Under this system, which is currently practiced throughout the world, the money supply varies with the quantity of legal reserves and the amount of credit issuance by banks.

Several major historical examples of financial regulatory reform occurred in the 20th century relating to fractional-reserve banking, made in response to the Great Depression and the many bank runs following the crash of 1929. These reforms included the creation of deposit insurance (such as the Federal Deposit Insurance Corporation) to mitigate against the danger of bank runs.[14] Countries have also implemented legal reserve requirements which impose minimum reserve requirements on banks.[15] Mainstream economists believe[14] that these monetary reforms have made sudden disruptions in the banking system less frequent.

However, some critics of fractional reserve banking argue that the practice inherently artificially lowers real interest rates and leads to business cycles propagated by excessive capital investment and subsequent contraction.[16] A small number of critics, such as Michael Rowbotham, equate the practice to counterfeiting, because banks are granted the legal right to issue new loans while charging interest on the money thus created. Rowbotham argues that this concentrates wealth in the banking sector with various pernicious effects.[13]

Money creation by the central bank

Some critics discuss the fact that governments pay interest for the use of money which the central bank creates "out of nothing".[17] These critics claim that this system causes economic activity to depend on the actions of privately owned banks, which are motivated by self-interest rather than by any explicit social purpose or obligation.

International organizations and developing nations

Some monetary reformers criticise existing global financial institutions like the World Bank, International Monetary Fund, Bank of International Settlements and their policies regarding money supply, banks and debt in developing nations, in that they appear to these writers to be "forcing" a regime of extortionate or unpayable debt on weak Third World governments that do not have the capacity to pay the interest on these loans without severely affecting the well-being or even the viability of the local population. The attempt by weak Third World governments to service external debt with the sale of valuable hard and soft commodities on world markets is seen by some to be destructive of local cultures, destroying local communities and their environment.[9][13][18]

Arguments for reform

Proponents of monetary reform find the current system of money creation unjust. The most common arguments for a transition to full-reserve banking or sovereign money are listed below:

  • Money are created when a loan is made and this money disappear when the loan is paid down. The central banks cannot control the money supply when private banks are creating credit money. Credit money can be converted to reserve money in various ways so that there is no practical limit to the amount of credit money that can be created by private banks.[19][20] This increases the risk of economic crises, unemployment, and bank bailouts or bank runs.[21][22]
  • Less than 6% of the money in circulation in the world is coins and bank notes, the rest originates from bank credit, carrying interest. This interest allows banks to earn rents from the mere fact that money exist. Reformers do not think it fair that the whole society is paying rents to the banks just for having money to circulate.[20][21][23]
  • The total amount of public and private debt in the world is now between two and three times the amount of broad money in circulation.[24] This is a result of the accumulated compound interest of credit money. This counterintuitive fact makes it virtually impossible to repay all debt. The mathematical consequence is that somebody will have to go bankrupt even if they have done nothing wrong. It seems unfair that somebody will become destitute as a consequence of the money system rather than because of their own reckless behavior.[20][22][25]
  • It is not only individual persons and businesses that go bankrupt as a consequence of the fact that there is more debt than money in circulation. Many states have gone bankrupt and some states have done so many times. The debt problem is particularly severe for developing countries that have debt in foreign currencies. The International Monetary Fund and the World Bank have been promoting loans to resource-rich developing countries for the expressed purpose of promoting economic growth in these countries, yet these loans were denominated in foreign currencies and most of the money were used for paying transnational entrepreneurs without ever entering the local economy. These countries have been forced to sell off national assets in order to service the debt.[19][25][22] Also a number of countries in the European Union are affected when a large part of the money circulating in the country originates from banks in other member countries. The spiraling, unpayable national debt has led to social chaos and even war in some cases.[21][26]
  • A major part of all new credit money that is created is spent on changing the ownership of existing assets rather than creating new assets. This process inflates the prices of assets, including real estate, factories, land, and intellectual rights. This makes living unnecessarily costly for everybody. It contributes to growing inequality and it makes the economy unstable because of the creation of asset bubbles.[27][23][28][22]
  • The exponentially increasing debt in society can only be serviced as long as the rate of economic growth exceeds the interest rate. This creates an imperative for perpetual growth in production and consumption. This leads to overconsumption and overexploitation of resources.[29] The technological progress in labor-saving technologies has not given us more leisure as we expected, because of the necessary growth in consumption.[26][23][28][22]

Arguments against reform

While proponents of monetary reform have produced many books, reports, and policy papers full of documentation, those who prefer to preserve the present banking system have mostly met the criticism of the generation of money as credit with silence. Opponents of reform have voiced their arguments mainly in the few cases where the issue has been brought up in parliamentary debates. In Switzerland, the issue has been the subject of a public referendum. (See the Wikipedia article on the Swiss sovereign-money initiative for details). The main arguments for keeping the current system of money creation based on credit or fractional reserve banking are listed below:

  • Switching to an untested banking system that differs from that of other countries would lead to a situation of extreme uncertainty.[31][32]
  • The central bank would quite likely be subjected to political pressures for producing more money for whatever purpose is high on the political agenda. Giving in to such pressures would lead to inflation.[32]
  • The finance sector would be weakened because its profit is reduced.[32]
  • A reform would lead to an unhealthy concentration of power at the central bank. Critics doubt that the central bank can determine the required money supply better than the private banks can.[31][33]
  • The central bank may have to provide credit to commercial banks and accept the accompanying risk.[31]
  • A sovereign money system would stimulate the creation of shadow banking and alternative means of payment.[34]
  • In the traditional banking system, the central bank controls the interest rate while the money supply is determined by the market. In a sovereign money system, the central bank controls the money supply while the market controls the interest rate. In the traditional system, the need for investments determines the amount of credit that is issued. In a sovereign money system, the amount of saving determines the investments. This change of influences will generate a new and different system with its own dynamics and possible instabilities. The interest rate may fluctuate as well as the liquidity. It is not certain that the market will find an equilibrium where the liquidity is sufficient for the needs of the real economy and full employment.[35][36]

Many of the arguments for and against monetary reform have been met with counter-arguments. An evaluation of the validity of the arguments and counter-arguments is outside the scope of the present Wikipedia article.

Alternative money systems

Central Bank independence

To regulate credit creation, some countries have created a currency board, or granted independence to their central bank. The Reserve Bank of New Zealand, the Reserve Bank of Australia, the Federal Reserve, and the Bank of England are examples where the central bank is explicitly given the power to set interest rates and conduct monetary policy independent of any direct political interference or direction from the central government. This may enable the setting of interest rates to be less susceptible to political interference and thereby assist in combating inflation (or debasement of the currency) by allowing the central bank to more effectively restrict the growth of M3.[37]

However, given that these policies do not address the more fundamental issues inherent in fractional reserve banking, many suggest that only more radical monetary reform can promote positive economic or social change. Although central banks may appear to control inflation, through periodic bank rescues and other means, they may inadvertently be forced to increase the money supply (and thereby debase the currency) to save the banking system from bankruptcy or collapse during periodic bank runs, thereby inducing moral hazard in the financial system, making the system susceptible to economic bubbles.[38]

International monetary reform

Theorists such as Robert Mundell (and more radical thinkers such as James Robertson) see a role for global monetary reform as part of a system of global institutions alongside the United Nations to provide global ecological management and move towards world peace, with Robert Mundell in particular advocating the revived use of gold as a stabilising factor in the international financial system.[39][40] Henry Liu of the Asia Times Online argues that monetary reform is an important part of a move towards post-autistic economics.[41]

While some mainstream economists favour monetary reforms to reduce inflation and currency risk and to increase efficiency in the allocation of financial capital, the idea of all-encompassing reform for green or peace objectives is typically espoused by those on the left-wing of the subject and those associated with the anti-globalization movement.[42]

Social credit and the provision of debt-free money directly from government

Still other radical reform proposals emphasise monetary, tax and capital budget reform which empowers government to direct the economy toward sustainable solutions which are not possible if government spending can only be financed with more government debt from the private banking system. In particular a number of monetary reformers, such as Michael Rowbotham, Stephen Zarlenga and Ellen Brown, support the restriction or banning of fractional-reserve banking (characterizing it as an illegitimate banking practice akin to embezzlement) and advocate the replacement of fractional-reserve banking with government-issued debt-free fiat currency issued directly from the Treasury rather than from the quasi-government Federal Reserve. Austrian commentator Gary North has sharply criticized these views in his writings.[43]

Alternatively, some monetary reformers such as those in the social credit movement, support the issuance of repayable interest-free credit from a government-owned central bank to fund infrastructure and sustainable social projects. This social credit movement flourished briefly in the early 20th century, but then became marginalized. In Canada, it was an important political movement that ruled Alberta through nine legislatures between 1935 and 1971, and also won many seats in Québec. It died out in the 80s.

Both these groups (those who advocate the replacement of fractional-reserve banking with debt-free government-issued fiat, and those who support the issuance of repayable interest-free credit from a government-owned central bank) see the provision of interest-free money as a way of freeing the working populace from the bonds of "debt slavery" and facilitating a transformation of the economy away from environmentally damaging consumerism and towards sustainable economic policies and environment-friendly business practices.

Examples of government issued debt-free money

Some governments have experimented in the past with debt-free government-created money independent of a bank. The American Colonies used the "Colonial Scrip" system prior to the Revolution, much to the praise of Benjamin Franklin. He believed it was the efforts of English bankers to revoke this government-issued money that caused the Revolution.[44] Abraham Lincoln used interest-free money created by the government to help the Union win the American Civil War.[45] He called these 'Greenbacks' "the greatest blessing the people of this republic ever had."[46][47]

Local barter, local currency

Some go further and suggest that wholesale reform of money and currency, based on ideas from green economics or Natural Capitalism, would be beneficial. These include the ideas of soft currency, barter and the local service economy.

Local currency systems can operate within small communities, outside of government systems, and use specially printed notes or tokens called scrips for exchange. Barter takes this further by swapping goods and services directly; a compromise being the Local Exchange Trading Systems (LETS) scheme: a formalised system of community-based economics that records members' mutual credit in a central location.

Commodity money

Some proponents of monetary reform desire a move away from fiat money towards a hard currency or asset-backed currency, which is often argued to be an antidote to inflation. This may involve using commodity money such as money backed by the gold, silver or both, commodities which supporters argue possess unique properties: their extraordinary malleability, their strong resistance to forgery, their character as stable and impervious to decay, and their inherently limited supply.[48]

Digital means are also now possible to allow trading in hard currencies such as gold, and some believe a new free market will emerge in money production and distribution, as the internet allows renewed decentralisation and competition in this area, eroding the central government's and bankers' old monopoly control of the means of exchange.[49][50]

Free banking

Some monetary reformers favour permitting competing banks to issue private banknotes whilst also eliminating the central bank's role lender of last resort. In the absence of these factors, they believe a gold standard or silver standard would arise spontaneously out of the free market.

See also

References

  1. ^ For an example of the use of the term, see this contribution from Bilderberg.org
  2. ^ Sound Money Archived 23 April 2009 at the Wayback Machine, Lew Rockwell
  3. ^ Our Money Madness, Lew Rockwell
  4. ^ The Case for a Gold Dollar, Murray Rothbard
  5. ^ What has Government done to our money?, Murray Rothbard
  6. ^ The Case for a 100% Gold Dollar, Murray Rothbard
  7. ^ Free Banking and the Free Bankers, Jörg Guido Hülsmann, Quarterly Journal of Austrian Economics (Vol. 9, No. 1)
  8. ^ "Sovereign Money". Retrieved 2018-09-13.
  9. ^ a b Brown, Ellen H. (2007). Web of Debt. Baton Rouge, Louisiana: Third Millennium Press. ISBN 0-9795608-0-2. Retrieved 2007-12-15.
  10. ^ Stephen A. Zarlenga, The Lost Science of Money AMI (2002)
  11. ^ Market Fundamentalism, Richard C. Cook
  12. ^ As an example of such groups, see the Social Credit website and the Social Credit School of Studies
  13. ^ a b c Rowbotham, Michael (1998). The Grip of Death: A Study of Modern Money, Debt Slavery and Destructive Economics. Jon Carpenter Publishing. ISBN 978-1-897766-40-8.
  14. ^ a b Mankiw, N. Gregory (2002). Macroeconomics (5th ed.). New York: Worth Publishers. p. 489. ISBN 0-7167-5237-9.
  15. ^ Mankiw, N. Gregory (2002). Macroeconomics (5th ed.). New York: Worth Publishers. p. 487. ISBN 0-7167-5237-9.
  16. ^ Murray Rothbard, The Mystery of Banking
  17. ^ For an example of the public criticism of the current monetary system, see the speech of the Earl of Caithness in the House of Lords on 5 March 1997
  18. ^ As an example of groups critical of the World Bank, see the "Whirled Bank" website
  19. ^ a b Werner, Richard A. (2016). "A Lost Century in Economics: Three Theories of Banking and the Conclusive Evidence". International Review of Financial Analysis. 46 (July): 361–79. doi:10.1016/j.irfa.2015.08.014.
  20. ^ a b c d Benes, Jaromir and Michael Kumhof (2012). “The Chicago Plan Revisited.” IMF Working Paper, no. 202.
  21. ^ a b c Zarlenga, Stephen (2002). The Lost Science of Money: The Mythology of Money - The Story of Power. American Monetary Institute. ISBN 1-930748-03-5.
  22. ^ a b c d e Di Muzio, Tim; Robbins, Richard H. (2017). An Anthropology of Money: A Critical Introduction. Routledge. ISBN 978-1-138-64600-1.
  23. ^ a b c Jackson, A. and Dyson, B. (2012). Modernising Money: Why our Monetary System is Broken and how it can be Fixed. London: Positive Money.
  24. ^ Data sources: CIA. "The World Factbook". Central Intelligence Agency. Retrieved 2018-09-06.. Desjardins, Jeff. "All of the World's Money and Markets in One Visualization". The Money Project. Retrieved 2018-09-06.
  25. ^ a b c Brown, Ellen Hodgson (2012). Web of Debt: The Shocking Truth about Our Money System and How We Can Break Free. Third Millennium Press. ISBN 978-0983330851.
  26. ^ a b c Eisenstein, Charles (2011). Sacred Economics: Money, Gift, and Society in the Age of Transition. North Atlantic Books. ISBN 978-1-58394-397-7.
  27. ^ Bezemer, Dirk, and Michael Hudson (2016). Finance Is Not the Economy: Reviving the Conceptual Distinction. Journal of Economic Issues, vol. 50 (3), pp. 745–768.
  28. ^ a b Korten, David C. (2010). Agenda for a New Economy: From Phantom Wealth to Real Wealth. Berrett-Koehler Publishers.
  29. ^ Mellor, Mary (2010). The Future of Money: From Financial Crisis to Public Resource. London.
  30. ^ Drexler, Bill. "The Credit river decision". World Newsstand.
  31. ^ a b c Thomas Jordan, "How money is created by the central bank and the banking system", Swiss National Bank, 2018-01-16
  32. ^ a b c d e f Schneider-Ammann, Johann N.; Thurnherr, Walter (2016). Botschaft zur Volksinitiative «Für krisensicheres Geld: Geldschöpfung allein durch die Nationalbank! (Vollgeld-Initiative)» (PDF). Schweizerischer Bundesrat.
  33. ^ Birchler, Urs (2017-11-01). Vollgeld-Leitfaden (PDF). Institut für Banking und Finance, Universität Zürich. Retrieved 2018-09-11.
  34. ^ Fontana, Giuseppe; Sawyer, Malcolm (2016). "Full Reserve Banking: More 'Cranks' than 'Brave Heretics'". Cambridge Journal of Economics. 40 (5): 1333–1350. See also Dyson, Ben; Hodgson, Graham; van Lerven, Frank (2016). "A Response to Critiques of 'Full Reserve Banking'". Cambridge Journal of Economics. 40 (5): 1351–1361. and Fontana, Giuseppe; Hodgson, Graham (2017). "A Rejoinder to 'A Response to Critiques of "Full Reserve Banking"". Cambridge Journal of Economics. 41 (6): 1741–1748.
  35. ^ Margeirsson, Olafur (2014). Financial Instability and Foreign Direct Investment (PDF). Doctoral dissertation, University of Exeter. pp. 251–264.
  36. ^ Dittmer, Kristofer (2015). "100 percent reserve banking: A critical review of green perspectives". Ecological Economics. 109: 9-16.
  37. ^ Manipulating the Interest Rate: a Recipe for Disaster, by Thorsten Polliet, December 2007
  38. ^ Moral Hazard Effects of Central Bank Intervention Archived 24 March 2008 at the Wayback Machine, by Nouriel Roubini
  39. ^ Uses and Abuses of Gresham's Law, by Robert Mundell
  40. ^ The Role of Money, James Robertson
  41. ^ The Road to Hyperinflation, Henry C.K. Liu
  42. ^ As an example of such groups, see the Sustainable Economics website
  43. ^ Gertrude Coogan's Bluff, Greenback Populism as Conservative Economics
  44. ^ America Created its Own Money in 1750, by Congressman Charles G. Binderup
  45. ^ The Forgotten War
  46. ^ Source of quote discussed here
  47. ^ Quoted in the Michael Journal here
  48. ^ Theory of Money and Credit, Ludwig von Mises 1953
  49. ^ Not Losing Your Head Archived 16 April 2009 at the Wayback Machine, Speech by Lew Rockwell
  50. ^ Free Market Money System by F.A. Hayek

External links

Abolitionist Party of Canada

The Abolitionist Party of Canada was a Canadian political party founded by perennial candidate John Turmel. The party ran on a platform of: monetary reform, including the abolition of interest rates and the income tax, the use of the local employment trading system of banking, and introducing a form of Social Credit with monthly dividends being paid out to each Canadian.

Unlike many Canadian social credit parties, the Abolitionists were not social conservatives, advocating, for instance, the legalization of marijuana and gambling.

Turmel attempted to run for the leadership of the national Social Credit party after the resignation of Fabien Roy in 1981, but the party chose to appoint Martin Hattersley instead. In 1982, Turmel founded the Christian Credit Party, which he disbanded in 1983.

Turmel founded the Abolitionist Party in 1993 with a similar program to that of the Christian Credit Party. The Abolitionist Party nominated 80 candidates in the 1993 federal election, who collected only 9,141 votes between them. (See also: Abolitionist Party candidates, 1993 Canadian federal election.) The Abolitionist Party subsequently reverted to being a personal vehicle for Turmel.

In 2003, Turmel attempted to organize a new party using the name of the defunct Libertarian Party of Canada, but was prevented from doing so by old members of the Libertarian Party who registered the name.

Bank of North Dakota

The Bank of North Dakota (BND) is a state-owned-run financial institution, based in Bismarck, North Dakota. It is the only state-owned facility of its type in the United States other than the Puerto Rico Government Development Bank.

Belarusian ruble

The Belarusian ruble or rouble (Belarusian: рубель rubieĺ; sign: Br; code: BYN) is the official currency of Belarus. The ruble is subdivided into 100 kapeks (Belarusian: капейка kapiejka).

Canada Party

The Canada Party was a short-lived political party in Canada that nominated 56 candidates in the 1993 federal election and one candidate in a 1996 by-election. It was unable to win any seats. The party was populist and ran on a platform of banking and monetary reform. It also advocated direct democracy, referendums and recall elections

One element of their direct democracy policy was the proposal that the prime minister and cabinet members be elected by the government party's caucus in the House of Commons of Canada. The party argued that this would remove the power that the prime minister currently has to command loyalty from caucus members in return for the rewards of more authority in the government, e.g., appointments to Cabinet or to parliamentary secretary positions.

Many of the party's supporters were members of the Committee on Monetary and Economic Reform, and later joined the Canadian Action Party. Some had been active in the Canadian social credit movement which shared similar views on monetary reform.

The party was founded by Joseph Thauberger who had been an unsuccessful Social Credit Party of Canada candidate in the 1972 election. Saskatchewan and British Columbia were the main sources of the party's membership. The first national meeting was held in Toronto a few weeks before the 1993 election. The party won 7,506 votes in that election.

During a televised forum of minor party leaders, Thauberger said to Neil Paterson, the leader of the Natural Law Party of Canada, "For the life of me, I can't imagine how you expect to meditate away the national debt!"

In 1994, Thauberger stepped down and was replaced by Claire Foss at a meeting in Winnipeg. In the run-up to the 1997 election, the party's board voted to support Paul Hellyer's Canadian Action Party because of that party's support for monetary reform. Foss ran as a CAP candidate in Okanagan—Shuswap where he and gained the largest number of votes of any CAP candidate. Foss was also a CAP candidate in the 2004 election but he fared poorly at the polls.

Canadian Action Party

The Canadian Action Party (CAP) (French: Parti action canadienne, PAC) was a Canadian federal political party founded in 1997 and deregistered on 31 March 2017.The party stood for Canadian nationalism, monetary and electoral reform, and opposed liberal globalization and free trade agreements that had been signed by the Canadian government.

Chicago plan

The Chicago plan was a collection of banking reforms suggested by University of Chicago economists in the wake of the Great Depression. A six-page memorandum on banking reform was given limited and confidential distribution to about forty individuals on 16 March 1933. The plan was supported by such notable economists as Irving Fisher, Frank H. Knight, Lloyd W. Mints, Henry Schultz, Henry C. Simons, Garfield V. Cox, Aaron Director, Paul H. Douglas, and Albert G. Hart.

Between March and November 1933, the Chicago economists received comments from a number of individuals on their proposal, and in November 1933, another memorandum was prepared. The memorandum was expanded to thirteen pages; there was a supplementary memorandum on "Long-time Objectives of Monetary Management" (seven pages) and an appendix titled "Banking and Business Cycles" (six pages).

These memoranda generated much interest and discussion among lawmakers. However, the suggested reforms, such as the abolition of the fractional reserve system and imposition of 100% reserves on demand deposits, were shelved and replaced by less drastic measures. The Banking Act of 1935 institutionalized Federal deposit insurance and the separation of commercial and investment banking. It successfully restored the public's confidence in the banking system and ended discussion of banking reform.

Committee on Monetary and Economic Reform

The Committee on Monetary and Economic Reform (COMER) is an economics-oriented publishing and education centre based in Toronto, Canada.

Demand deposit

Demand deposits, bank money or scriptural money are funds held in demand deposit accounts in commercial banks. These account balances are usually considered money and form the greater part of the narrowly defined money supply of a country. Simply put, these would be funds like those held in a checking account.

Full-reserve banking

Full-reserve banking (also known as 100% reserve banking) is a proposed alternative to fractional-reserve banking in which banks would be required to keep the full amount of each depositor's funds in cash, ready for immediate withdrawal on demand. Funds deposited by customers in demand deposit accounts (such as checking accounts) would not be loaned out by the bank because it would be legally required to retain the full deposit to satisfy potential demand for payments. Proposals for such systems generally do not place such restrictions on deposits that are not payable on demand, for example time deposits.Monetary reforms that included full-reserve banking have been proposed in the past, notably in 1935 by a group of economists, including Irving Fisher, as a response to the Great Depression. More recently, there has been renewed interest following the Great Recession.Currently, no country in the world requires full-reserve banking. Banks operating under a full-reserve ratio generally do so by choice or by contract, although the governments in some countries such as Iceland and the US have considered implementing full reserve banking to avoid future financial crises. In 2018, Switzerland voted on the Sovereign Money Initiative which has full reserve banking as a prominent component of its proposed reform of the Swiss monetary system. The measure was overwhelmingly rejected.

Gerry McGeer

Gerald Grattan McGeer (6 January 1888 – 11 August 1947) was a lawyer, populist politician, and monetary reform advocate in the Canadian province of British Columbia. He served as the 22nd Mayor of Vancouver, a Member of the Legislative Assembly in BC, Member of Parliament for the Liberal Party of Canada, and in the Canadian Senate.

Irish Monetary Reform Association

The Irish Monetary Reform Association (also known as the Monetary Reform Party) was a minor Irish political party of the 1940s. It was little more than an electoral vehicle for Oliver J. Flanagan, the long-serving TD for the constituency of Laois–Offaly. As such, it is difficult to draw conclusions about the party independent from those about Flanagan himself. Monetary Reform can be seen as the most successful of a wave of minor far right parties in 1940s Ireland, like Ailtirí na hAiséirighe. Flanagan played on certain themes of the Social Credit movement, which accentuated his image as an anti-Semitic politician.

Monetary reform in Britain

Monetary reform is the process of fundamentally changing policies regarding money. It can include changes to the money creation process, fractional-reserve banking, financial institutions, financing of the economy and Social Credit among other things.

Monetary reform in Russia, 1993

Russia's monetary reform of 1993 took place from 26 July to 7 August 1993.

Monetary reform in Russia, 1998

The monetary reform of 1998 in Russia was launched on January 1, 1998. Preparation started in August 1997. Replacement of the old banknotes occurred gradually, until 2002.

Monetary reform in the Soviet Union, 1991

Monetary reform of 1991 (known also as Pavlov Reform) was the last of such in the Soviet Union. The reform had a confiscatory character. It began on January 22, 1991. Its architect was Minister of Finance Valentin Pavlov, who was to become the last prime minister of the Soviet Union.

Monetary system

A monetary system is the set of institutions by which a government provides money in a country's economy. Modern monetary systems usually consist of the national treasury, the mint, the central banks and commercial banks.

Open market operation

An open market operation (OMO) is an activity by a central bank to give (or take) liquidity in its currency to (or from) a bank or a group of banks. The central bank can either buy or sell government bonds in the open market (this is where the name was historically derived from) or, in what is now mostly the preferred solution, enter into a repo or secured lending transaction with a commercial bank: the central bank gives the money as a deposit for a defined period and synchronously takes an eligible asset as collateral. A central bank uses OMO as the primary means of implementing monetary policy. The usual aim of open market operations is—aside from supplying commercial banks with liquidity and sometimes taking surplus liquidity from commercial banks—to manipulate the short-term interest rate and the supply of base money in an economy, and thus indirectly control the total money supply, in effect expanding money or contracting the money supply. This involves meeting the demand of base money at the target interest rate by buying and selling government securities, or other financial instruments. Monetary targets, such as inflation, interest rates, or exchange rates, are used to guide this implementation.

Solomon Islands Social Credit Party

The Solomon Islands Social Credit Party ("Socreds") is a political party in the Solomon Islands that espouses social credit theories of monetary reform.

It is led by Prime Minister Manasseh Sogavare, previously leader of the People's Progressive Party and the former Member of Parliament for East Choiseul. The party was launched in July 2005.It is a member of a four-party coalition, the Solomon Islands Alliance for Change, which includes the National Party, Solomon Islands Liberal Party, and the Solomon Islands Party for Rural Advancement, and groups of independents from Honiara, Malaita and Guadalcanal.The Solomon Islands Social Credit Party traces its origins to the New Zealand Social Credit Party (now the New Zealand Democratic Party) and one of its leaders, Bruce Beetham, who hosted a Solomon Islands student in his home. That student, Solomon Mamaloni, later became prime minister of the Solomon Islands.The party, running candidates for the first time, contested 29 constituencies in the April 5, 2006, national election. The party won 4.3% of the vote and 2 seats.

The party opposes foreign control of the economy, and advocates a full monetary and financial reform in line with the social credit thinking. It believes that the islands' poverty can only be addressed through social credit monetary reform.

State bank

A state bank is generally a financial institution that is chartered by a state. It differs from a reserve bank in that it does not necessarily control monetary policy (the state in question may have no legal capacity to create monetary policy), but instead usually offers only retail and commercial services.

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