Too many people just assume that the government must control the currency. Too many people cannot wrap their thoughts around the idea of free enterprise money. The government has had control for a long time, and since they already took over education, they teach the government must control the money. Too often, they teach that all free-market attempts at currency were failures. They promote only the good of the Federal Reserve without explaining the harms. Even the top business, finance, and monetary schools teach with flawed fundamentals. Governments' monopoly control of money has done considerable damage.
The government changes the value of currency thus also contracts. The government taxes the people by shaving value from our money with QE, accordingly, violating the US Constitution.
The Federal Reserve creates price controls on the use of money over time and government price controls ALWAYS do harm. The role of prices of the use of money over time is valuable yet infringed under the current laws and policies.
The US dollar has lost over 96% of its value over the last 100 years, hampering the critical role of saving in the economy. Capitalism requires capital. Thus unbacked-up or fiat money is destabilizing to capitalism.
The policies implemented to fulfill the Federal Reserve’s dual mandates for full employment and stable values are counterproductive and do tangible harm.
Using money allows you to do half trades. You trade your labor for money and then use that money to get services. It allows you to sell your services to different people than you get services from. The money should hold value so the time of the services you give can be different from the time you receive the services.
There are many factors in money. What will hold its value the best? What is universally desired? What is easily divisible? What is easily transferred? What is easily verifiable? What has uniform quality? What can stand up to the test of time? Does the rule of law give proper protection? What is universally accepted?
Having a dozen different providers will allow many monetary models to emerge to address every one of these questions. Trillions of decisions by billions of people will enable constant improvements.
Every bank will have their choice of which Financial CRA will regulate them. All banks and CRA’s will be rated, and consumers of banking services will ultimately force standards to increase by choosing higher-rated banks. Banking regulations are vitally important; thus, a competition of different models is imperative.
A CRA creates a currency by collecting assets and issuing certificates of ownership to a percentage of the portfolio of assets. As more assets enter, the portfolio percentages per unit are reduced to maintain a constant value. If there are 10 grams of gold in the portfolio and 100 units of currency issued than each unit are worth 1% of the portfolio or 0.1 grams of gold. If 90 more grams are deposited than 900 more units of currency are issued. Each unit of currency is now worth 0.1% of the entire portfolio or still the 0.1 gram of gold. At any time, units of currencies should be able to be turned in and assets diminished with the last unit of currency collecting the last of the assets.
Many different assets will be tried with many portfolios consisting of hundreds of different types of assets. Each asset will come in with a price and added to the value of the portfolio. As prices of assets within a portfolio adjust to market forces, the value of the portfolio adjusts. The owner of a note will own, for example, 0.000000000231% of the portfolio. His percentage does not change. However, the value does.
The Financial Sector Board will collect currency from the roughly dozen CRA’s to create the average of all currencies called the backed dollar or BD. The BD will be the currency of paper and coins. CRA currencies would be mostly digital.
There are considerable benefits in having all currencies synchronized in value per unit. No one wants to have to look at exchange rates when buying products. If your CRA portfolio outperforms the average, the BD, then your value per unit does not change, you just get additional units. On the other side, if your CRA portfolio underperforms the BD, then you lose units of currency. This is similar to current stock on the stock market in that you still own the same percentage of the company; however, when the company value adjusts, so does the worth of each stock in terms of dollars. Those that want stable amounts of units could hold accounts that mirror the BD.
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