The new concept of money
Capitalism is under attack. Our economic system is blamed for the growing imbalances in our economy. However, capitalism is not to at fault, our monetary system is.
In 1971 the gold standard was abolished, and the world entered the FIAT currency era. Since then there has been very limited control over the supply of money.
Governments and banks are now able to create money at will by issuing new dept. As they both have obvious incentives to create more money, a lot of dept is created.
The global debt is now at an all-time high at more than 300% of GDP and is increasing exponentially. In 2017 alone global dept increased by 7 times more than economic growth.
When we create more money than the economic growth, we experience what we refer to as inflation. The prices increase, but no real value is added. In 2017 the global GDP was 79 trillion and there was created 21 trillion in new dept, ie new money. Economic growth was 2 trillion. This leaves 19 trillion for inflation. Only 3 trillion of this went to inflate consumer prices, which is the only inflation measured. A staggering 16 trillion went to inflate other markets, such as real estate and stocks. This show us that having inflation target could be very problematic as most people don’t spend the exceed money on consumer goods.
The hyperinflation in these markets is a key driver for the fast-growing inequality because these markets are a lot more accessible to those with a lot of money in the first place. Most people have bills to pay and don’t have the exceed money or the knowledge to speculate.
When dept is created, interest pours into the financial sector and this attracts both human capital and investments. Smart people find smart ways to sell money to each other instead of creating real value. Investments goes towards bidding up financial prices instead of growing the economy. The financial sector, which should be a service and facilitator for other sectors, now grows rapidly at the expense of the rest of the economy.
Subsequently the economic growth has more halved since we got rid of the gold standard. We have made a smaller cake which is shared more unequally.
To sum up, we experience imbalances and a slowing economy largely because we after abolishing the gold standard have very limited control over the supply of money.
Bitcoin is often referred to as digital gold. Due to its unpolitical and trustworthy nature a lot of people think it will take the same role as gold had as a world currency. With its fixed supply of 21 million coins there is undoubtably full control of the supply.
The problem is that when there is created less money than the economic growth, the amount of money compared to the economy will decrease. This forces the prices to fall and we experience what we refer to as deflation. Deflation is even worse than inflation. When prices fall, no one is willing to invest in anything else than the currency and the economy breaks down. Bitcoin is great for speculation, but only anarchist will want it to become a global currency.
Concluding that inflation and deflation is bad leaves us with only one option, keeping prices stable. This is obtainable by creating money at the same rate as the economic growth. By linking the currency to GDP money will be a pure representation of real value.
As we, until now, have no real definition of money it makes a lot of sense to tie it up to the economy in order to make its value easy understandable.
Linking money to GDP will also ensure that money goes toward productive investments as all other prices would stabilize. This will discourage unproductive speculation and lead to optimal allocation of resources, thus the highest economic growth possible.
We actually tested this during the gold standard, when we, by chance, produced new gold at approximately the same rate as the economic growth. This is the unknown reason for why the gold standard kept prices stable overt time and balanced the economy. However, production of gold did not follow the economy growth exactly and was easy to cheat on.
Globe is a perfection of the gold standard and will serve as an unpolitical and trustworthy world currency and a safe store of value.
Globe also works as a digital benchmark for how national currencies and monetary systems should be managed in order to ensure the greatest social and economic benefits.
Prizing commodities and doing large international trades in Globe will increase trust in the global market and free the world from today’s dollar dependency. This has never been fair, especially now as the US has gone from being the worlds largest creditor to the world’s largest debtor.
Restraining money creation will also prevent structural trade deficits that has caused the many nations working classes to be forgotten and the ongoing trade war.
Nations will no longer be able to run continues budget deficits running trade deficits by borrowing money instead of collecting taxes. A moral hazard that has led a lot of western contries to borrow money from their future generations.
Trond Andreas and Espen agrees to change the world togetherFebruary, 2020
Now we are more than just a great idea.August 2020
Telling the world for the first timeMarch 2021
We are looking for $3-4 million for programming and promotingMay 2021
What is GLOBE exactly?
GLOBE is un-political world fare money that is based upon a natural synthesis of the Gold standard and the FIAT monetary system, restoring real value as the basic building block of the financial system.
With the power of blockchain technology, the supply of GLOBE will be distributed in a transparent manner by using tried and tested ledger technology which will be increased to match the world's earnings and production growth, as measured by official GDP data.
GLOBE will be a digital benchmark for how national currencies and monetary systems should be managed in order to reap the greatest social and economic benefits. A GLOBE-based world monetary system will prevent trade deficits, discourage unproductive speculation and resource allocation, and lead to optimal economic growth and income distribution.
Is GLOBE Secure?
Blockchain Technology: GLOBE uses blockchain technology to create an open, trustful and reliable system for money distribution. Oracles: GDP growth is external information that is not naturally registered on the blockchain. Therefore, GLOBE will use an “Oracle” to feed the GDP growth. Network: The GLOBE Network will use a Proof of Authority (PoA) consensus system with 21 Nodes (Validators), elected and authorized by the GLOBE Foundation. This will allow GLOBE to maintain high transaction rates, industry leading security and agility to remain competitive. GLOBE network is also capable of side chains and internal transactions, improving efficiency and providing value added options to adopters. Adaptability: In a continuously changing world GLOBE has the ability to rapidly adapt to new advancements, consistently ensuring market leading security, features and scalability.
How is GLOBE solving today’s challenges?
GLOBE provides solutions to ‘low economic growth problems’ that occurred after the suspension of the gold standards in 1971. GLOBE by linking money supply to GDP will promote optimal resource allocation and eliminate the opportunity for the banking and government sectors to grow at the expense of the rest of society. GLOBE also gives a solution to ‘Inequality problems’ which happened after the gold standard got suspended and workers were not able to get their fair share of production (productivity growth + inflation compensation). For this, GLOBE will promote fair wages and equality by making countries not to borrow and pay for excess imports this is how sustained trade deficits will become impossible. GLOBE is an answer to ‘Speculation Hazard’ issues which are a kind of government inflation power forcing people to speculate and maintain their purchasing power. Here, GLOBE will initiate stable prices and stable purchasing power. This will allow people not to speculate to earn a decent rate of return on their savings.
What are advantages of GLOBE?
Globe is the first currency in the world to be an exact representation of real value as measured by global GDP data. Linking the money supply with GDP growth will ensure optimal resource allocation and economic growth, curbing the exponential debt growth, structural trade deficits, inflated financial sector and increasing inequality. This is supported by both economic theory and empirical evidence. GLOBE secured by blockchain technology cannot be mined by the general public. GLOBE is monitored & governed by GLOBE Foundation which ensures the best possible lawful structure for an unbiased & unaltered world currency.
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