So Bernard Lietaer proposes a new global currency, the Terra, to be backed by a basket of stable commodities. The Terra should ease currency risks, facilitate international trade, underwrite long term investement and leverage large scale infrastructure.
What is a basket of stable commodities ? Oil yoyos, uranium is a thin market, rare earth metals are close to monopoly, steel could be locked in and unrecyclable if designed into transcontinental gas pipelines and railways, Lithium will run out if tried on a natural scale for battery cars. Meaningless biofuels distorted food markets.
Now all of the commodities above would have done better as a basket anchor than Wall Street crooks, national money printing and – gold, respectively. Wall Street greed itself is a large part of the problem we’re in. At the current rate of printing tailspin and Black Hole banking, pls show me a solid reasoning that we’re not headed towards another Great Depression – or the Mother Of All Inflations. As for printing, both Benjamin Franklin printing Continental Scrip and Abraham Lincoln churning out Greenbacks did quite well. Ol’ Honest Abe financed the hemorraghing Civil War, kicked bankers’ ass and supported an uninterrupted industrial boom with only 30% inflation on the dollar – not bad. For those of you still fancying gold, pls understand that gold does not do the trick. There’s too little of it and people are too psychologically attached to it. Gold currency leads to Scrooge economics, modern slavery so to say and a too tight emphasis on so-called property rights. On this subject, pls consult The Gridlock Economy to see how philosophical principles extended to large scale undermine optimal development – a sort of anti-commons for the common worse.
Let’s introduce global thorium Th reserves to back a global currency, The Torro. OECD’s Red Book reports 6 million tons Th. When countries start updating their inventories, there will probably be at least 15 million tons because Th is 3x more geochemically abundant than uranium. A couple of truly unique geological formations, volcanoes in Norway and Namibia (I think it is), could contain rare earths and Th deep down int0 the crust for kilometers. Suppose there’s a universally accepted commodity method for turning Th into kWhs (the molten salt piping) and set a global kWh-price of 0.03€. Do your math and discover that global thorium generate future revenue streams of at the order of ~ 1 million trillions € – when Th is allowed to account for some %s of the kWh !
That’s not so bad compared to the CDS derivates that commercial banks owe to the shadow banking system – or the other way around was it – Last I looked these Collateral Damage Sheets , as sarcastics call them, totalled 100 trillion $ – 1000 times less the Th mountain.
And by the way, the Th mountain is real. It can’t be sliced into risk and it’s premium, it will increase nicely and slowly in value as people pay more for the kWh and discover some more of it. The only valuable use of Th would be for kWh production. Costs for mining, purification, storage and molten salt reactors are like oil infrastructure to oil – ie nothing in comparison. It’ so much of it that high speed rails across Eurasia and hydrogen production for global car fleet should be a piece of cake. Even George Soros wouldn’t speculate against the Torro nor could Hank Paulson pull rabbits out of his bald head.
