Month: May 2020

“Some of the greatest theorists about money…thought it better to be multiple competing currencies rather than a single global standards, and there were plenty of periods in history where that was the case. Standardization of money came relatively late to the world. One of the lessons of history is that with globalization comes a tendency for a particular currency to become the number one dominant currency for transactions, for trade, for international reserves. A great question to ask is: globalization enters this phase of crisis: will there be some other transition from the dollar to another currency? Or could we see a reversion to a multipolar, multi currency world?” - Niall Ferguson 

This episode is sponsored by ErisX, The Stellar Development Foundation and Grayscale Digital Large Cap Investment Fund.

On the first episode of Money Reimagined, we looked at the strange paradox of the US dollar. On the one hand, massive stimulus fueled by money printer go brrr should suggest for inflation. At the same time, however, there is no denying that the dollar is stronger than ever, rising in value compared to other currencies in spite of that inflation potential. 

There is a sense among many, however, that this strength is relative, temporary, and above all, unsustainable. In a world where a global dollar based monetary system does not serve the interest of the world, what replaces it? 

This episode is about the sovereign contenders - in other words, the currencies that would work through existing power structures and paradigms, but replace the dollar with something else. 

We look first at the Euro. Created in the wake of the Cold War to bind a newly reborn Europe in shared identity and economic destiny, it entered the COVID-19 crisis in a beleaguered state. Brexit had taken the most valuable economy out of the union and flagging economies within it created significant fragility. What’s more, Europe simply doesn’t have the monetary tools available to a country like the United States. Peter Zeihan, the geopolitical strategist and author of Disunited Nations, explained it like this: 

“There’s nothing that the Europeans can do in terms of stimulus spending without raising debt. Even if they decided to do something like QE - which last time took years - they would now have to have the debate over who gets how much. The Europeans are having a hard time raising the capital necessary for dealing with this crisis, whereas the US can just flip a switch.” 

CoinDesk’s Chief Content Officer Michael Casey pointed out that the EU is also dealing with questions of political validity, with COVID-19 exacerbating a fundamental issue. 

“The capacity of the EU to act in unison and the common interest the EU is supposed to represent kind of fell apart. All of a sudden, borders got shutdown and it was each nation to him or herself. So the EU’s validity to manage this has been challenged. COVID is a force for decentralizing power. From a currency perspective, the value of these currencies are political questions. Therefore the EU’s political validity is being questions right now. I’m not sure that’s going to be a very positive environment for the Euro.” 

**

The next contender profiled is the Libra project. While much of the initial conversation about the Libra focused on the past transgressions and potential political illegitimacy of its founding organization of Facebook, for economists and system thinkers, the most powerful idea contained in the project was the idea of a global currency standard backed by a basket of the world’s fiat rather than pegged to any single currency. In many ways, this harkened back to John Maynard Keynes’ Bretton Woods proposal for a bancor - separate from the individual currencies of nations around the world. Indeed, in many ways, the most interesting impact of Libra initially was getting global central bankers like Mark Carney to propose their own ‘synthetic hegemonic currencies.’

Finally, we look at China’s digital currency or DCEP. Is it an unbelievable surveillance honeypot? An attempt to front run the West on a key technological innovation? A method of extending economic spheres of influence? Or is it all of the above?

Music by DJ J-Scrilla "Faith In My Money (Money Printer Go Brrr)" from the new “Sound Money” album.

Produced by NLW and Adam B. Levine. Edited, Scored and Announced by Adam B. Levine with production assistance from the rest of the team at CoinDesk.

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Historic unemployment as the government reveals April jobless numbers. Coronavirus at the White House. Arrests in a jogger's killing in GA. CBS News Correspondent Steve Kathan has today's World News Roundup.

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How can stockmarkets be so healthy when many businesses are so unwell? We look at the many risks that are clearly not priced in. China’s documentary-makers are having to find clever ways to get past censors—which is why one famed filmmaker is just giving his work away online. And remembering a legendary rock-climber who always wanted to find a new way up.

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The news to know for Friday, May 8th, 2020! 

What to know today about the latest states working to reopen and what the White House is saying about the original benchmarks being ignored.

And two very different, controversial legal cases are causing an uproar around the country.

Plus, new ridesharing rules, a reality show on Twitch, and a Banksy painting with a purpose.

Those stories and more in less than 10 minutes!

Head to www.theNewsWorthy.com or see sources below to read more about any of the stories mentioned today.

This episode is brought to you by www.Blinkist.com/news and www.MagicSpoon.com/newsworthy

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Sources:

More States Reopening: AP, LA Times, CNN, CNN, Business Insider

Record Job Losses: USA Today, WSJ

Trump Personal Valet Tests Positive: Reuters, Politico

DOJ Dropping Flynn Case: WaPo, WSJ, Axios, CBS News

Murder Charges in Ahmaud Arbery Shooting: NBC News, ABC News

Run in Honor of Arbery: People, CNN

Potentially Historic May Weather NY Times, FOX News, WaPo

Airlines See Some Improvement: USA Today, CNBC

‘Smart City’ Project Abandoned: BBC, VentureBeat

Lyft’s New Rules: TechCrunch, Mashable, Lyft

Twitch Reality Shows: Bloomberg

Banksy Honors Healthcare Workers: CNN,  BBC

Mother’s Day Sunday: Restaurant Deals, Flower Deals, Last-Minute Gifts

Feel Good Friday - Wedding Turned Food Drive: Newsday, WNBC

American workers are more than ready to get back to work, according to Rep. Trey Hollingsworth.

The Indiana Republican joins The Daily Signal Podcast to talk about how his state is handling the impact of the coronavirus, state bailouts, sheltering in place, what the economic effects of the coronavirus shutdown will be, and much more.

We also cover these stories:

• The Texas Supreme Court ordered the release of a Dallas hair salon owner who was put in jail for contempt of court after refusing to keep her business closed due to the coronavirus. 
• Over the past seven weeks, 33.5 million Americans have filed for unemployment. That is roughly 10% of our nation's population. 
• New video footage has emerged of the killing of Ahmaud Arbery, an African American who was shot twice by Travis McMichael. 

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