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 JUNE – JULY 2009www.nexusmagazine.comNEXUS • 11
TOWARDS A GLOBAL CURRENCY AND WORLD GOVERNMENT
F
ollowing the 2009 G20 summit, plans were announced forimplementing the creation of a new global currency to replace theUS dollar's role as the world reserve currency. Point 19 of thecommuniqué released by the G20 at the end of the Summit stated:"We have agreed to support a general SDR allocation which will inject$250bn (£170bn) into the world economy and increase global liquidity."SDRs, or Special Drawing Rights, are "a synthetic paper currency issued bythe International Monetary Fund [IMF]". As the UK
Telegraph
reported:"...the G20 leaders have activated the IMF's power to create money andbegin global 'quantitative easing'. In doing so, they are putting a de factoworld currency into play. It is outside the control of any sovereign body.Conspiracy theorists will love it."
1
The article continued in stating: "There is now a world currency inwaiting. In time, SDRs are likely to evolve into a parking place for theforeign holdings of central banks, led by the People's Bank of China."Further, "[t]he creation of a Financial Stability Board looks like the firststep towards a global financial regulator", or, in other words, a globalcentral bank.It is important to take a closer look at these "solutions" being proposedand implemented in the midst of the current global financial crisis. Theseare not new suggestions, as they have been in the plans of the global elitefor a long time. However, in the midst of the current crisis, the elite havefast-tracked their agenda of forging a New World Order in finance. It isimportant to address the background to these proposed and imposed"solutions" and what effects they will have on the International MonetarySystem (IMS) and the global political economy as a whole.
A NEW BRETTON WOODS AGREEMENT
In October 2008, Gordon Brown, Prime Minister of the UK, said that we"must have a new Bretton Woods—building a new international financialarchitecture for the years ahead". He continued in saying that "we mustnow reform the international financial system around the agreedprinciples of transparency, integrity, responsibility, good housekeepingand co-operation across borders". An article in the
Telegraph
reported thatGordon Brown would want "to see the IMF reformed to become a 'globalcentral bank' closely monitoring the international economy and financialsystem".
2
On 17 October 2008, Prime Minister Gordon Brown wrote an op-ed inthe
 Washington Post
in which he said: "This week, European leaders cametogether to propose the guiding principles that we believe shouldunderpin this new Bretton Woods: transparency, sound banking,responsibility, integrity and
global governance
. We agreed that urgent
The Financialhe FinancialNew World Orderew World Order
In response to thecurrent economiccrisis, plans are beingfast-tracked to createa New World Order infinance and establisha global central bankand regionalcurrencies if not asingle currency.Part 1 of 2
by Andrew G. Marshall
Research AssociateCentre for Research on GlobalizationMontreal, Canada© 6 April 2009 Website:http://www.globalresearch.ca
 
decisions implementing these principles should bemade to root out the irresponsible and oftenundisclosed lending at the heart of our problems. Todo this, we need cross-border supervision of financialinstitutions; shared global standards for accountingand regulation; a more responsible approach toexecutive remuneration that rewards hard work, effortand enterprise but not irresponsible risk-taking; andthe
renewal of our international institutions
to make themeffective early-warning systems for the worldeconomy."
3
(Emphasis added.)In early October 2008, it wasreported that "as the world'scentral bankers gather thisweek in Washington DC for anIMF–World Bank conference todiscuss the crisis, the bigquestion they face is whether itis time to establish a globaleconomic 'policeman' toensure the crash of 2008 cannever be repeated". Further,"any organisation with thepower to police the globaleconomy would have to includerepresentatives of every majorcountry—a United Nations ofeconomic regulation". A former governor of the Bankof England suggested that "the answer might alreadybe staring us in the face, in the form of the Bank forInternational Settlements (BIS)". However, he said:"The problem is that it has no teeth. The IMF tends tocouch its warnings about economic problems in verydiplomatic language, but the BIS is more independentand much better placed to deal with this if it is giventhe power to do so."
4
EMERGENCE OF REGIONAL CURRENCIES
On 1 January 1999, the European Union establishedthe euro as its regional currency. The euro has grownin prominence over the past several years. However, itis not to be the only regional currency in the world.There are moves and calls for other regional currenciesto be set up throughout the world.In 2007,
Foreign Affairs
, the journal of the Council onForeign Relations, ran an article titled "The End ofNational Currency", in which it began by discussingthe volatility of international currency markets andsaying that very few "real"solutions have been proposedto address successive currencycrises. The author posed thequestion: "...will restoring lostsovereignty to governmentsput an end to financialinstability?"He answered by stating:"This is a dangerousmisdiagnosis... The rightcourse is not to return to amythical past of monetarysovereignty, with governmentscontrolling local interest andexchange rates in blissfulignorance of the rest of the world. Governments mustlet go of the fatal notion that nationhood requiresthem to make and control the money used in theirterritory. National currencies and global marketssimply do not mix; together they make a deadly brewof currency crises and geopolitical tension and createready pretexts for damaging protectionism. In orderto globalize safely, countries should abandonmonetary nationalism and abolish unwantedcurrencies, the source of much oftoday's instability."The author explained: "Monetarynationalism is simply incompatiblewith globalization. It has alwaysbeen, even if this has only becomeapparent since the 1970s, when allthe world's governments renderedtheir currencies intrinsicallyworthless." The author stated:"Since economic developmentoutside the process of globalizationis no longer possible, countriesshould abandon monetarynationalism. Governments shouldreplace national currencies with thedollar or the euro or, in the case of Asia, collaborate to produce a newmultinational currency over acomparably large and economicallydiversified area."
5
12• NEXUSwww.nexusmagazine.com JUNE – JULY 2009
The euro has grownin prominence over thepast several years.However, it is not to bethe only regional currencyin the world.
 
Essentially, according to the author, the solution liesin regional currencies. According to a Bloombergreport, in October 2008 "European Central Bankcouncil member Ewald Nowotny said a 'tri-polar'global currency system is developing between Asia,Europe and the US and that he's skeptical the USdollar's centrality can be revived".
6
The Union of South American Nations
The Union of South American Nations (UNASUR)was established on 23 May 2008, with theheadquarters to be in Ecuador, the South AmericanParliament to be in Bolivia, and the Bank of the Southto be in Venezuela. The BBC reported: "The leaders of12 South American nations have formed a regionalbody aimed at boosting economicand political integration in theregion... The Unasur members are Argentina, Bolivia, Brazil, Chile,Colombia, Ecuador, Guyana,Paraguay, Peru, Suriname, Uruguayand Venezuela."
7
The week following theannouncement of the Union, it wasreported: "Brazilian President LuizInácio Lula da Silva said...that South American nations will seek acommon currency as part of theregion's integration efforts followingthe creation of the Union ofSouth American Nations..." Hewas quoted as saying: "We areproceeding so as, in the future,we have a common central bankand a common currency."
8
The Gulf Cooperation Counciland a Regional Currency
In 2005, the Gulf CooperationCouncil (GCC), a regional tradebloc among Bahrain, Kuwait,Oman, Qatar, Saudi Arabia andthe United Arab Emirates,announced the goal of creating a single commoncurrency by 2010. It was reported: "An economicallyunited and efficient GCC is clearly a more interestingproposition for larger companies than each individualeconomy, especially given the impediments to tradeevident within the region. This is why trade relationswithin the GCC have been a core focus of late."Further, it was stated that "[t]he natural extension ofthis trend for increased integration is to introduce acommon currency in order to further facilitate tradebetween the different countries". It was announcedthat "the region's central bankers had agreed topursue monetary union in a similar fashion to therules used in Europe".
9
In June 2008, it was reported that "Gulf Arab centralbankers agreed to create the nucleus of a joint centralbank next year in a major step forward for monetaryunion but signaled that a new common currencywould not be in circulation by an agreed 2010 target".
10
In 2002, it was announced that the "Gulf states saythey are seeking advice from the European CentralBank on their monetary union programme". InFebruary 2008, Oman announced that it would not bejoining the monetary union. In November 2008, it wasreported that the "[f]inal monetary union draft says[the] Gulf central bank will be independent fromgovernments of member states".
11
In March 2009, it was reported: "The GCC should notrush into forming a single currency as member statesneed to work out the framework for aregional central bank, Saudi Arabia'sCentral Bank Governor Muhammad Al Jasser said..." Al Jasser wasquoted as saying: "It took theEuropean Union 45 years to puttogether a single currency. We should not rush." In 2008, withthe global financial crisis, newproblems were posed for the GCCinitiative: "Pressure mounted lastyear on the GCC members to droptheir currency pegs as inflationaccelerated above 10 per cent in fiveof the six countries. All of themember states except Kuwaitpeg their currencies to the dollarand tend to follow the USFederal Reserve when settinginterest rates."
12
An Asian Monetary Union
In 1997, the BrookingsInstitution, a prominent American think-tank, discussedthe possibilities of an East AsianMonetary Union, stating: "Thequestion for the 21st century iswhether analogous monetary blocs will form in East Asia (and, for that matter, in the WesternHemisphere). With the dollar, the yen, and the singleEuropean currency floating against one another, other,small open economies will be tempted to link up toone of the three."But the linkage will be possible only if accompaniedby radical changes in institutional arrangements likethose contemplated by the European Union. Thespread of capital mobility and politicaldemocratization will make it prohibitively difficult topeg exchange rates unilaterally. Pegging will requireinternational cooperation, and effective cooperationwill require measures akin to monetary unification."
13
 JUNE – JULY 2009www.nexusmagazine.comNEXUS • 13
"The GCC[Gulf CooperationCouncil] shouldnot rush intoforming a singlecurrency asmember statesneed to work outthe framework fora regional centralbank..."
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