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The Ikon

What major monetary and banking reforms are needed?

Enough deceit!

      The global financial crisis should be seen as a symptom of the lack of fit between three pieces of the jigsaw of modern finance – national or regional monies, innovative financial markets and a globalized financial system. It provided both an encouragement and a warning – an encouragement to search for alternatives…
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Geoffrey Ingham on Money

Why the debate on the nature of money matters

  As the debate about the future of finance has yet to yield consensus on the way forward for policy, so more radical solutions are being openly discussed and advocated. This has stimulated a spreading debate on the very nature of money and banking. Geoffrey Ingham, a Life Fellow of Christ’s College, Cambridge, has brought the…
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Geoffrey Ingham and “The Money Trap”

My gloss on his ideas - and what they mean for mine

  Two key aspects or functions of money: 1. As a convenient medium of exchange – can be anything; but that’s not enough, as exchange rates between multiple media of exchange would be variable and result in anarchy 2. As a unit of account – this is primary, as Keynes taught – and explains why…
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1. The case for a global monetary standard

All major economies remain stuck in The Money Trap. The way out is to adopt a new monetary standard, the Ikon

 Introduction To be in the trap means two things: The international monetary anti-system: Governments are in the trap when they act in the belief that if they get monetary, regulatory and fiscal policy “just right” for their own economies,  they can achieve their aims – full employment, growth, stability – without paying attention to the…
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2. For and against reform

We should start building a consensus on world money

What are the forces favouring reform – and those obstructing it?   Natural development: There is a natural tendency for a dominant currency to emerge as the de facto global currency. The US dollar has served that purpose and inertia keeps it in the leading place. But It is in the interests of the US…
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3. New models for banking and international money

Concluding this three-part article

    We need radical new models of international money as well as global banking and finance. The underlying purposes are to re-connect finance with the real world and to put individual responsibility and risk-bearing capacity back at the centre of the system. There is an important role for governments, which must agree and set…
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Adair Turner (2): Misguided remedies

  Caveat: I should mention to begin with that this critique is based on Lord Turner’s paper  on “Escaping the Debt Addiction”; one paper cannot cover every area and he has (I understand) written a soon-to-be-published book that will presumably range more widely.   The approach in this paper can be compared with that developed…
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The bare bones of a new policy regime

It should comprises two elements - a new international monetary system and a new banking system

  As argued in the post “Regime Uncertainty Undermines Confidence”, only a new policy regime, not changes to individual policy areas (such as regulatory policy) will reduce the existential angst that is crippling business and over-shadowing the recovery. New money….. It should establish a global currency standard. The standard should be sufficiently attractive that countries…
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Golden opinions

Policy-makers can learn from the long history of monetary gold

  The attributes of gold usually cited as making it useful as money are summed up by the World Gold Council as follows:   “Gold’s scarcity, the fact that it does not corrode or tarnish, its malleability and status across civilisations have made it eminently suitable as a form of money.”   There is more…
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The Ikon – towards a new currency unit

How the global monetary standard proposed in

  The global monetary unit woud be defined by international treaty. The value of the unit is defined by a basket of diversified global equity shares, represented by an index (see W Engels, 1981). An international currency board would be tasked to hold the value of the monetary unit constant against the basket (index). I…
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