Just a heads up for regular readers. At this point in time, based on the information available, I have set an end date for regular blog articles here at around July 2018. When this blog started, there was a lot of speculation from both mainstream media sources and alternative media sources that major changes to the existing monetary system might be on the near term horizon. Since that time I have observed dozens of predictions for this event to happen with specific dates attached come and go.
Now, here we are four years later and no such changes have taken place. At some point it just does not make sense to continue to write regular articles trying to cover an event that is (so far) not taking place. So, why June 2018?--------------------------------------------------------------------------------------------------------------------
I chose mid 2018 because by then the only major known potential events that could trigger enough instability in the current monetary system that might lead to major change will have either happened or not happened. Right now, a major failure related to the Trump Administration (the President being forced to leave office for example) or a serious shooting war with North Korea are the primary known potential events. By mid to fall 2018 it should be obvious if either of those situations will lead to a major disruption of our present monetary system. Right now the North Korean situation looks more concerning than anything related to the Trump Administration (although this new Trump related situation will be something to keep an eye on). Also, in his latest comment Jim Rickards is pushing back his time frame for war with North Korea to "late 2018".
But what about the huge global debt issue and the related massive derivatives situation? Aren't those potential ongoing triggers for major systemic problems? Yes, they are. But they have been for many years now and no one knows if or when they might surface to cause a major disruption. They have been covered here extensively along with a variety of major proposals on how to reform or remake a new monetary system if that should become necessary. That information will stay archived here and available to anyone who finds it useful. It's possible some events regarding gradual changes to the existing system may be worth covering now and then after June 2018. However, if those drag out over too long a time frame, it is hard to maintain reader interest in a scenario where change happens slowly over an extended period of time.
Some more detailed added comments:
In the four years I have worked on this blog, my primary goal has been to try and find the most accurate information I can and share that for free with anyone who has interest. I have done my best to provide accurate information and offer what analysis I can that is my best honest understanding of the situation.
My views and analysis are heavily shaped by two main factors:
- an attempt to read a wide variety of information and viewpoints from both mainstream media sources and alternative media sources (literally hundreds of articles and interviews)
- direct input from what I consider some of the leading experts in the world on the topics that have been covered here (people with decades of experience related to these issues)
Based upon all of that effort (involving literally thousands of hours of time spent in research and many efforts to reach out to the experts), I have concluded that it is unlikely we will see the kind of major monetary system change that I thought might be on the horizon when I started the blog -- unless --
some kind of major new global crisis literally forces that kind of major change into the system. I do not make this statement lightly. My main reasons for reaching this conclusion are:
- obtaining global consensus for something this huge and complicated does not appear to be realistic under the present circumstances.
- while I can find plenty of evidence that there is concern about the stability of the current system and a number of ideas for reform and even full systemic replacement are out there, I can find no evidence that a realistic detailed plan to form a global consensus and implement an one grand global plan in the real world exists at this time. In fact all the evidence I have suggests otherwise.
- I have come to learn that trying to implement a global monetary and payments system around one new global currency would be a very complicated endeavor just from a technology standpoint (not to mention a philosophical and political one). This is not something you can just pull off the shelf and insert into the real world any time you please. It's an extremely tedious and slow process to come up with a working system and test it in real world situations (even if you could get consensus on one plan or idea which is not the case at this time).
- I do not believe the IMF is anywhere near ready to implement a plan like I described just above. I believe the IMF is simply continuing to monitor events and study various ideas, but has no detailed plan of implementation they could use for a "new SDR" at this time. I suspect that even getting to that point would be very tricky, time consuming, and probably next to impossible in the current divisive environment.
- If the IMF did have such an implementation plan somewhere, they still have to get a majority consensus vote of the members to make any needed changes to IMF rules to implement the plan. That is hard to do even on less complicated issues these days. A new SDR based monetary system using some kind of new version of the SDR would be much more complicated and politically difficult to pull off. And again, you need a tested working system to do it as well (not just a work paper proposal).
- I believe that while central banks are starting the process of looking into using central bank digital currencies, we likely will not see any major central banks doing that any time soon. The US Fed has flatly stated this recently and I believe them. Again, no technology or detailed plan of implementation to do this exists as far as I know at this time on a global scale. I would watch what Singapore does first for clues.
- It is possible that China and Russia may try to move forward with some kind of system that could eventually bypass the US dollar based system we have now. However, even as they attempt this, it certainly will not be a global system as the US and other western nations would not go along with it. This is more likely to lead to some kind of major conflict that I think both sides would prefer to avoid because the end result is more likely to be a lose/lose scenario. China especially prefers to avoid that kind of situation. While China does want more global usage of the yuan, it has actually expressed more interest in trying to use the SDR at the IMF as a global reserve currency than the yuan. I see NO evidence of any kind that the US is willing to move in that direction at this time and the US has full veto power at the IMF under present voting rules. Nothing here suggests a true global consensus is on the near term horizon.
The above list of issues and problems is what causes me to say that I don't see major change unfolding rapidly unless some kind of new major crisis forces all these very diverse factions to work together to literally save the present system from collapse (or restart a new one). Presently, I find no indication that there is any deep concern inside the system that a systemic collapse is at hand.
I never rule out the possibility of a systemic failure because it could happen. However, based on what I have seen from extensive personal research and direct input from very high credibility sources, I feel it would be dishonest to suggest that, absent a new crisis, major monetary system changes are on the near term horizon. Every indication I get is just the opposite.
It is much more likely in my view that the present system will continue to limp along for as long as it can with whatever support is needed from time to time (by central banks etc) to make that happen. Meanwhile I think the central banks will continue to monitor and study the new Fintech that is emerging to see what parts of it may be useful to them or not. I still expect any changes they might make in that regard to be relatively minor in terms of their impact on the overall system. I don't think any final decisions on any of that have been made or that any one technology is emerging as the consensus choice for use inside the system at this time. Alternatives outside the present system attempting to compete with it are severely hampered by lack of legal tender status and official government support. Also, for now, a huge majority of the public is fine with the existing major currencies and monetary system.
It is very possible that the IBM hyperledger (partnering with KlickEx and Stellar) could emerge for use by central banks and I think readers should watch to see if some central banks (starting with perhaps Singapore) try that out in 2018. If that does happen, then watch to see if more central banks adopt that concept afterwards. Once again though, this would just be using the same existing national currencies (not new currencies or one new global currency) and would mostly just speed up the existing payments process and make it less expensive.That is certainly a good thing and substantial news, but not an overhaul of the exisiting monetary system. In fact one leading global payments expert who works in this space every day flatly told me recently - "I don't think the monetary system is going to change a lot."
All this is why I have concluded that by mid 2018 I will likely end regular blog articles here. If we don't see some indications by then that something major is emerging to change the whole monetary system, there is just no way to guess how long this process could take. It could be less than a year (in a new major crisis) or it could take decades to see major changes take place.
If it is the latter, I just cannot expect readers to stay engaged here for such a long time frame without seeing major changes that might truly impact their daily lives taking place. Also, I will have a hard time coming up with meaningful articles without something significant happening to cover relating to major systemic changes.
This is my honest assessment of the situation at this time and I wanted to fully explain it to readers since I have many readers who have followed this blog for quite some time. If something changes my view, I will certainly post that and explain why. I cannot express my appreciation enough both for readers who have sent me article links and the group of experts who have provided extremely valuable and highly credible input to help me out. I plan to try and produce fairly regular articles until mid 2018 (a few per month as usual) as we wait to see if anything major unfolds.
I want to wish everyone a Happy New Year for 2018!
Added news note 1-6-18: This is a perfect added news note for this post that a reader alerted me to today:
As noted above the US Fed has also recently cooled on the idea of a central bank digital currency. This is in line with what has been reported here.