BRICS Working on New Form of Currency

[Free Vulcan]

The BRICS countries are working on creating a new form of currency and may present ideas on its development at the organization's upcoming summit in South Africa, State Duma Deputy Chairman Alexander Babakov said on Thursday.

"The transition to settlements in national currencies is the first step. The next one is to provide the circulation of digital or any other form of a fundamentally new currency in the nearest future. I think that at the BRICS [leaders' summit], the readiness to realize this project will be announced, such works are underway," Babakov said on the sidelines of the Russian-Indian Strategic Partnership for Development and Growth Business Forum.

He also did not rule out the possibility of a single currency emerging in BRICS. This currency could be secured not just by gold, but also by other groups of products, rare-earth elements or soil, Babakov added.

https://sputniknews.com/20230330/brics-working-on-new-form-of-currency---state-duma-deputy-chairman-1108974142.html

[catfish1957]

Probably too late, but should be a matter of U.S. policy that any country joining BRICS is a direct threat to $USD solvency, and they will lose all foreign aid at that point.

[Kamaji]

It'll be fun to see if that herd of cats can stick around long enough to do something meaningful and not just fall apart into internecine squabbling.

[bigheadfred]

Maybe you know this @catfish1957. How do you secure a currency with soil?

[DefiantMassRINO]

Given that the West will attempt to use the power of the US Dollar and the Euro as an enforcement mechanism for asinine Global Climate Change policies, it's in the BRICS' economic and development self-interest to de-couple themselves from the Dollar and the Euro.

[catfish1957]

Maybe you know this @catfish1957. How do you secure a currency with soil?

'
Wow Fred, not sure of the intent of question (riddle?)

In the literal sense, post crash, our fiat currency might be worthless, or worth very little.  Burying it might burn up more calories than the its value as a paper fuel.  Depends on how high the level  hyperinflation ensues.  Gold and Silver OTOH, will always have fungilbe value in commerce.  In any case,   I hope we can survive as a soverign nation.

As far as soil as a currency?  That is why I own 3 farms, that are nicely rented out.  We will have that at least level of bartered income, unless the government or who ever takes us over seizes it. 

For years we have all had a lot of discussion around prep.  With the events of the past few years, we have gone from DEFCON 3 to 2. 

[catfish1957]

Given that the West will attempt to use the power of the US Dollar and the Euro as an enforcement mechanism for asinine Global Climate Change policies, it's in the BRICS' economic and development self-interest to de-couple themselves from the Dollar and the Euro.

Bingo.   The whole NWO guiding principles have been around being able to from a practical basis enact full wealth redistribution. Sounds like it is all gelling together. 

[bigheadfred]

'
Wow Fred, not sure of the intent of question (riddle?)

In the literal sense, post crash, our fiat currency might be worthless, or worth very little.  Burying it might burn up more calories than the its value as a paper fuel.  Depends on how high the level  hyperinflation ensues.  Gold and Silver OTOH, will always have fungilbe value in commerce.  In any case,   I hope we can survive as a soverign nation.

As far as soil as a currency?  That is why I own 3 farms, that are nicely rented out.  We will have that at least level of bartered income, unless the government or who ever takes us over seizes it. 

For years we have all had a lot of discussion around prep.  With the events of the past few years, we have gone from DEFCON 3 to 2.

The question comes from the article. I had the thought he (Babakov) meant land when he said soil, but one never knows.   

[catfish1957]

The question comes from the article. I had the thought he (Babakov) meant land when he said soil, but one never knows.   

Ohhh...  Okay Fred, I see what you mean. 

"He also did not rule out the possibility of a single currency emerging in BRICS. This currency could be secured not just by gold, but also by other groups of products, rare-earth elements or soil, Babakov added."

What that means is that whatever entity is created for BRIS that is analagous to the World Bank, Fed, IMF or other quasi regulatory structure will be tasked to have a backed new form of currency, and in their case, I think they are leaning with Gold, Rare Earth Minerals, and soil (Farm Land). I am glad you brought this up, because I was scratching my head on why BRIS was so hell bent on bringing South Africa on board.  A core of 4 or 5 countries strong in these areas could almost quad-handily establish a powerhouse of a currency that would squeeze out  the Euro or $USD in any scenario.  And considering the Euro, UK Pound, are $USD are highly fiat in nature, floating these against a BRIC currency will be devastating for us and them.  We concievably could see our buying power as nation evaporate by 25-75% (wild ass guess on my part)

Farmland- Brazil, Argentina Russia
Rare Earth Metals- China and Russia
Gold- South Africa,
Oil- OPEC, Russia

We don't have a chance.

[bigheadfred]

Ohhh...  Okay Fred, I see what you mean. 

"He also did not rule out the possibility of a single currency emerging in BRICS. This currency could be secured not just by gold, but also by other groups of products, rare-earth elements or soil, Babakov added."

What that means is that whatever entity is created for BRIS that is analagous to the World Bank, Fed, IMF or other quasi regulatory structure will be tasked to have a backed new form of currency, and in their case, I think they are leaning with Gold, Rare Earth Minerals, and soil (Farm Land). I am glad you brought this up, because I was scratching my head on why BRIS was so hell bent on bringing South Africa on board.  A core of 4 or 5 countries strong in these areas could almost quad-handily establish a powerhouse of a currency that would squeeze out  the Euro or $USD in any scenario.  And considering the Euro, UK Pound, are $USD are highly fiat in nature, floating these against a BRIC currency will be devastating for us and them.  We concievably could see our buying power as nation evaporate by 25-75% (wild ass guess on my part)

Farmland- Brazil, Argentina Russia
Rare Earth Metals- China and Russia
Gold- South Africa,
Oil- OPEC, Russia

We don't have a chance.

Thanks for the succinct response.

[Kamaji]

Ohhh...  Okay Fred, I see what you mean. 

"He also did not rule out the possibility of a single currency emerging in BRICS. This currency could be secured not just by gold, but also by other groups of products, rare-earth elements or soil, Babakov added."

What that means is that whatever entity is created for BRIS that is analagous to the World Bank, Fed, IMF or other quasi regulatory structure will be tasked to have a backed new form of currency, and in their case, I think they are leaning with Gold, Rare Earth Minerals, and soil (Farm Land). I am glad you brought this up, because I was scratching my head on why BRIS was so hell bent on bringing South Africa on board.  A core of 4 or 5 countries strong in these areas could almost quad-handily establish a powerhouse of a currency that would squeeze out  the Euro or $USD in any scenario.  And considering the Euro, UK Pound, are $USD are highly fiat in nature, floating these against a BRIC currency will be devastating for us and them.  We concievably could see our buying power as nation evaporate by 25-75% (wild ass guess on my part)

Farmland- Brazil, Argentina Russia
Rare Earth Metals- China and Russia
Gold- South Africa,
Oil- OPEC, Russia

We don't have a chance.

Maybe so, but what, in practice, will it mean to say that a new currency is backed by, say, farm land?  Will a holder of currency be able to convert that currency into direct ownership of farmland?  How would that work?  Would the farm land be acquired ahead of time, and title placed in a special purpose vehicle, so that title will pass automatically upon conversion?  How much farm land would be required to "secure" this new currency?  Will existing land owners sit still for it?  Or will they instead have their farm land taken from them, in exchange for units of the new currency?

And when push comes to shove, how much of that farm land will actually be available for conversion?

I don't see this working out particularly well.

[catfish1957]

Maybe so, but what, in practice, will it mean to say that a new currency is backed by, say, farm land?  Will a holder of currency be able to convert that currency into direct ownership of farmland?  How would that work?  Would the farm land be acquired ahead of time, and title placed in a special purpose vehicle, so that title will pass automatically upon conversion?  How much farm land would be required to "secure" this new currency?  Will existing land owners sit still for it?  Or will they instead have their farm land taken from them, in exchange for units of the new currency?

And when push comes to shove, how much of that farm land will actually be available for conversion?

I don't see this working out particularly well.

I see it working out very well in the respect that this will be the tip of the pyramid of "worth" as far as capital backing.  The more quandary is whether, as you alluded, are they are state owned lands.  I am guessing in the spirit of a free market, that the entities of BRICS will acquire, and then lease said lands.  OR.....   I didn't know if you are aware but there are actually a few United States  REITs that have 100% farm based assets.  So the concept has been applied in real life.  So I really don't see it as a problem for BRICS to estabish it as an asset class with its own commodity value that floats as well as oil, pork bellies, coffee, etc.

But think about it, even with the least form of perceptive fungible of the asset group they are proposing, it sure beats the fiat concept of "good faith", which is running in short supply for EU/U.S.  What we are witnessing is the "Great Reset".  And those who are outside looking in on fastly growing BRICS consortium are going to be the losers.                                                                           

[Kamaji]

I see it working out very well in the respect that this will be the tip of the pyramid of "worth" as far as capital backing.  The more quandary is whether, as you alluded, are they are state owned lands.  I am guessing in the spirit of a free market, that the entities of BRICS will acquire, and then lease said lands.  OR.....   I didn't know if you are aware but there are actually a few United States  REITs that have 100% farm based assets.  So the concept has been applied in real life.  So I really don't see it as a problem for BRICS to estabish it as an asset class with its own commodity value that floats as well as oil, pork bellies, coffee, etc.

But think about it, even with the least form of perceptive fungible of the asset group they are proposing, it sure beats the fiat concept of "good faith", which is running in short supply for EU/U.S.  What we are witnessing is the "Great Reset".  And those who are outside looking in on fastly growing BRICS consortium are going to be the losers.                                                                           

A REIT works because it is a private business arrangement and can be enforced by any aggrieved party to the contract.

A currency "secured" by real estate is not the same thing as all because the party setting all the terms is a government, and governments, particularly in the BRICS and other developing countries, have a very poor track record of honoring their obligations when push comes to shove.

If such a currency is issued, and there is a run on that currency, the farmland backing the currency will evaporate rather quickly into the mists of reality.

But, if you want to invest in it, go right ahead.  I'm sure they'll be glad to swap your USD for their dirt-pesos.

[catfish1957]

A REIT works because it is a private business arrangement and can be enforced by any aggrieved party to the contract.

A currency "secured" by real estate is not the same thing as all because the party setting all the terms is a government, and governments, particularly in the BRICS and other developing countries, have a very poor track record of honoring their obligations when push comes to shove.

If such a currency is issued, and there is a run on that currency, the farmland backing the currency will evaporate rather quickly into the mists of reality.

But, if you want to invest in it, go right ahead.  I'm sure they'll be glad to swap your USD for their dirt-pesos.

????   You are off topic.  My REIT comment was making the point that you were  questioning the fungiability of farm land.  I own 3 farms that are rented, and can easily inform you that I consider  them  the safest investments that I own.  And in the case of  the established REIT's I mentioned they are determined by market cap by a captilization blend of real estate value , plus the commodity value of those crops being grown.  It is an asset, and just that.  And measurable one too, which is inherently important in every changing value.

Additonally....  I hope you realize that the Farm aspect of the currency backing is just one of several, if you bothered to read the article.  When you include, oil, gold, rare earths, this is a strong smart blend of assets.  It makes me sick that our enemies have found a way to destroy us economically, by it will be death by currency exchange conversions on a seismic level.

But back to the matter of the BRICS currency say versus our currency you cite.... the  $USD, which is a fiat currency backed by nothing but good faith of a government that has put us  $32T in debt.  How is that working out for us?  You really think the tipping point is much greater than 150% Debt/GDP? I am not bullish on our prospects.

So your "track record 3rd world's" response means nothing, when taking account that our new world economic competitors are basing commerce on tender of something that has inherent value.  .  Many many very bright economist knew we would be doomed by getting off the gold standard. It  took a long time, but now it appears the chickens are coming home to roost.

[Kamaji]

????   You are off topic.  My REIT comment was making the point that you were  questioning the fungiability of farm land.  I own 3 farms that are rented, and can easily inform you that I consider  them  the safest investments that I own.  And in the case of  the established REIT's I mentioned they are determined by market cap by a captilization blend of real estate value , plus the commodity value of those crops being grown.  It is an asset, and just that.  And measurable one too, which is inherently important in every changing value.

Additonally....  I hope you realize that the Farm aspect of the currency backing is just one of several, if you bothered to read the article.  When you include, oil, gold, rare earths, this is a strong smart blend of assets.  It makes me sick that our enemies have found a way to destroy us economically, by it will be death by currency exchange conversions on a seismic level.

But back to the matter of the BRICS currency say versus our currency you cite.... the  $USD, which is a fiat currency backed by nothing but good faith of a government that has put us  $32T in debt.  How is that working out for us?  You really think the tipping point is much greater than 150% Debt/GDP? I am not bullish on our prospects.

So your "track record 3rd world's" response means nothing, when taking account that our new world economic competitors are basing commerce on tender of something that has inherent value.  .  Many many very bright economist knew we would be doomed by getting off the gold standard. It  took a long time, but now it appears the chickens are coming home to roost.

Yeah, because developing countries that get themselves into financial trouble always honor their debts.  Got an Argentine sovereign debt in your portfolio?

The point is, when push comes to shove, saying that this new currency is "secured" by anything other than the say-so of the sponsoring governments is to tell a lie.  The "security" won't be there precisely when it is needed.

Bitcoin is a better deal.

[catfish1957]

Yeah, because developing countries that get themselves into financial trouble always honor their debts.  Got an Argentine sovereign debt in your portfolio?

The point is, when push comes to shove, saying that this new currency is "secured" by anything other than the say-so of the sponsoring governments is to tell a lie.  The "security" won't be there precisely when it is needed.

Bitcoin is a better deal.

You really think Argentina is going to be the BRICS driver?  This is the Chicom's baby, and they are a hell of lot smarter than us on economic matters right now. They have an industrial base, we have none.   The add the asset base alone OPEC nations alone will add. 
They are holding the cards right now, and I know it pains you,  (It pains me) that we are getting ready to be whacked on a currency realignmnet.

And to the point of it being a lie?  Kind of hard to lie about known quantities of rare earth metals (acres and mines) Oil, reserves and industrial output, and farmland (acres and yields).  And as far as lies.....   Do you believe the U.S. has the gold reserves they describe?     Then add the point if you think they are lying, how does that stack up against outright criminal negligence of running up unprecedented debt.  Does the world stage trust an entity with tangible fungible assests, or one with good faith and a $32T credit card bill.  And that bill having no plan to payoff, or even reduce. 

And to the Bitcoin comment?  I didn't think you'd get silly. 

[catfish1957]

Gold has just hit an all time high throughout history as coupled with $USD.   Keep an eye on this number, VIX, and exchange rates.......

Lost on page 4, with all of the other static going on.  Damned distrations.........

$2036/oz

[Kamaji]

You really think Argentina is going to be the BRICS driver?  This is the Chicom's baby, and they are a hell of lot smarter than us on economic matters right now. They have an industrial base, we have none.   The add the asset base alone OPEC nations alone will add. 
They are holding the cards right now, and I know it pains you,  (It pains me) that we are getting ready to be whacked on a currency realignmnet.

And to the point of it being a lie?  Kind of hard to lie about known quantities of rare earth metals (acres and mines) Oil, reserves and industrial output, and farmland (acres and yields).  And as far as lies.....   Do you believe the U.S. has the gold reserves they describe?     Then add the point if you think they are lying, how does that stack up against outright criminal negligence of running up unprecedented debt.  Does the world stage trust an entity with tangible fungible assests, or one with good faith and a $32T credit card bill.  And that bill having no plan to payoff, or even reduce. 

And to the Bitcoin comment?  I didn't think you'd get silly. 

Did I say Argentina was going to be a BRICS driver?  No, I did not, and it is disingenous of you, at the least, to state otherwise.  I used Argentina as a poster-child example of what developing countries do when they hit financial stress.  And that is precisely what the BRICS are going to do with this precious "secured" currency - as soon as they hit financial stress, whatever "security" was advertised will evaporate.

In other words, this so-called new "secured" currency is going to be nothing more than just another fiat currency, and as such, very few significant traders will use it.  It will mostly be used for otherwise-economically-meaningless virtue-signaling exchanges between the sovereigns that have joined it.

[DefiantMassRINO]

Currency "security" is in the mind of the believer.

Once that belief, or faith, is violated, the currency loses its value and demand for it decreases.

2008 was the closest I've experience to a complete financial system collapse.

- Money market funds "broke the buck", losing principal.
- Oil prices went negative.
- Credit Markets seized.
- Return OF capital was paramount to return ON capital.

[catfish1957]

Did I say Argentina was going to be a BRICS driver?  No, I did not, and it is disingenous of you, at the least, to state otherwise.  I used Argentina as a poster-child example of what developing countries do when they hit financial stress.  And that is precisely what the BRICS are going to do with this precious "secured" currency - as soon as they hit financial stress, whatever "security" was advertised will evaporate.

In other words, this so-called new "secured" currency is going to be nothing more than just another fiat currency, and as such, very few significant traders will use it.  It will mostly be used for otherwise-economically-meaningless virtue-signaling exchanges between the sovereigns that have joined it.

Whaaaaa.....

BRICS currency will if expected enumerated tangible rare earth minerals, oil, gold, and farmland established as currency capital base and that is established as a flat guarantee"cartel" currency.  How is that fiat?  Did you even notice that South Africa is joining?  Is that an accident?  lol.

Say vs. greenbacks.  Outside the luxury of being propped up by being a reference currency.  Which has the better guarantee?  Add the fact exponential debt is being incurred, as a nuetral nation........   Who would you trust with your currency. One with tangible base that will provide sound fiscal fundamentals.  Or another that is an eyelash away from a hyperinflation scenario, if a run on the currency or their soverign debt ensues.

Oh, and by the way....  ths whole driver and master of this device is not a "developing country" issue.  Make not doubt that the PRC is the driver of this new train, and their  economic prospects are much better than ours, just based on industrial output potential alone. BTW, did or have you noticed PRC investment in South Africa and Africa?

Plus, what you are lining up us vs. then, I think you will find that US and EU, are predominately Service driven economies vs those in BRICS have much more upside on industrial input.  That same level of pretentiousness is what is help facilitating our economic downfall.

You can take the ostrich head in the sand approach to this crisis....   I know better.

[DefiantMassRINO]

PRC wants to control currency so it can maintain a positive balance of trade with its partners, a 21st century mercantile system.

The British fought the Opium Wars with China because Britain's unfavorable inbalance of trade with China was draining their silver reserves (money).

Britain needed to sell opium to China to restore a balance of trade that would help replenish Britain's silver reserves (money).

China wants to buy commodities from its mercantile partners while mercantile partners are "encouraged" to purchase value-added goods from China exclusively.

[Kamaji]

Whaaaaa.....

BRICS currency will if expected enumerated tangible rare earth minerals, oil, gold, and farmland established as currency capital base and that is established as a flat guarantee"cartel" currency.  How is that fiat?  Did you even notice that South Africa is joining?  Is that an accident?  lol.

Say vs. greenbacks.  Outside the luxury of being propped up by being a reference currency.  Which has the better guarantee?  Add the fact exponential debt is being incurred, as a nuetral nation........   Who would you trust with your currency. One with tangible base that will provide sound fiscal fundamentals.  Or another that is an eyelash away from a hyperinflation scenario, if a run on the currency or their soverign debt ensues.

Oh, and by the way....  ths whole driver and master of this device is not a "developing country" issue.  Make not doubt that the PRC is the driver of this new train, and their  economic prospects are much better than ours, just based on industrial output potential alone. BTW, did or have you noticed PRC investment in South Africa and Africa?

Plus, what you are lining up us vs. then, I think you will find that US and EU, are predominately Service driven economies vs those in BRICS have much more upside on industrial input.  That same level of pretentiousness is what is help facilitating our economic downfall.

You can take the ostrich head in the sand approach to this crisis....   I know better.

You have such an endearingly naive belief that a second-world government is actually going to stick to its agreements if/when it comes time to make good on the "security" behind this fancy new currency.

They won't, period.  And there is no mechanism, short of going to war against one of them, that will allow a disappointed party to foreclose on that security or to convert the currency into the underlying if the government of the day does not wish to do so.

As such, it is fiat currency for all practical purposes, because the only thing that makes the claim of "security" viable is the government's pinky promise that, if things get bad, it will in fact turn over the security it promised to back the currency with.

that's a laughable premise.

[catfish1957]

Currency "security" is in the mind of the believer.

Once that belief, or faith, is violated, the currency loses its value and demand for it decreases.

2008 was the closest I've experience to a complete financial system collapse.

- Money market funds "broke the buck", losing principal.
- Oil prices went negative.
- Credit Markets seized.
- Return OF capital was paramount to return ON capital.

Fully agree....   Currency at least on a global scale is no different to speculative forces than a stock or a mutual fund.  Currency commodity exchanges invest based on events and economic health of each said currency.  The fact that the $USD still is the world reference currency is the only reason we are not in free fall.  As I indicated above, I think some of the early signs of a problem will be when we see a shot up in gold prices.  It hit an all time high today.

And '08?  You are right there too.  What happened then was remedied by the irresponsible proverbial kicking the can down the road with QE madness.  At some point you can't keep blowing up that baloon without it popping.

[catfish1957]

You have such an endearingly naive belief that a second-world government is actually going to stick to its agreements if/when it comes time to make good on the "security" behind this fancy new currency.

They won't, period.  And there is no mechanism, short of going to war against one of them, that will allow a disappointed party to foreclose on that security or to convert the currency into the underlying if the government of the day does not wish to do so.

As such, it is fiat currency for all practical purposes, because the only thing that makes the claim of "security" viable is the government's pinky promise that, if things get bad, it will in fact turn over the security it promised to back the currency with.

that's a laughable premise.

I think what was lost in my post was your obtusively laughable POV term that I gave your "naive" understanding of economic princicpals.  You are sadly way past prententious in your thinking our first world status is tenable as a service economy, with spiraling out of control debt.

Our new enemy BRICS will have some growing pains, but your contention that they are less postioned for world domination, is about the silliest shit I have seen on this thread.  Get back to me when our Fed and Treasury Dept. start throwing the "Q" number around. (Quadrillion).  Tell us how that is working out when hyperinflation starts. 

Sure, you will keep on with your ostrich tactics, but that's your prerogative.

Apparently you think this

[Kamaji]

I think what was lost in my post was your obtusively laughable POV term that I gave your "naive" understanding of economic princicpals.  You are sadly way past prententious in your thinking our first world status is tenable as a service economy, with spiraling out of control debt.

Our new enemy BRICS will have some growing pains, but your contention that they are less postioned for world domination, is about the silliest shit I have seen on this thread.  Get back to me when our Fed and Treasury Dept. start throwing the "Q" number around. (Quadrillion).  Tell us how that is working out when hyperinflation starts. 

Sure, you will keep on with your ostrich tactics, but that's your prerogative.

Apparently you think this

I never once took the positions you accuse me of.  I have never stated that the U.S. current position is solid or defensible.  I am simply taking issue with the concept that some new currency is going to be "secure" in the sense that it will have something other than the issuing government's say-so behind it.

Which simply means that economic actors will be stuck with having to choose between various levels of "evil" - loose money and unicorn economic thinking - and even on that basis, the U.S. economy is still the lesser of two evils, at least when it comes to the BRICS.

How long will that state of affairs continue?  I don't know, and it is that uncertainty, coupled with the fact that the U.S. economy could, in fact, collapse, that presents the real risk.  But the genesis of that risk is our own continued profligacy, not the threat of some new currency coming from countries that are worse off economically than the U.S. is.