Vet67to82's Blog : Central Banks Role in a Global Economy

Yes, the news out of China and especially the EU was cause for concern exacerbated by worries about a liquidity shortfall in the European financial system after the European Central Bank reportedly refused to extend liquidity measures to banks and, instead, requested hundreds of billions in repayment from the continent's banks. Hmmmm!

Our USA Federal Reserve ... since 1913 has gone through 97+ years of economic trials and tribulations, boom ... and bust. The Fed's mandate, since 1970 require the Board and the FOMC "to promote effectively the goals of maximum employment, stable prices, and moderate long-term interest rates" . Yet, there are still things beyond the control of the FED ... like employment, and the global economies, global currencies, global competition, etc. all of which can individually, or in combination combine to undermine Fed actions on behalf of the USA. The European Central Bank ( ECB - est. by the Treaty of Amsterdam in 1998 ), in comparison, is the institution of the European Union (EU) tasked with administrating the monetary policy of the 16 EU member states taking part in the Eurozone. It is one of the world's most important central banks, but its roughly 12 years experience vs the Fed's 97 yrs, means its bound to make mistakes, perhaps the SAME mistakes our Fed has made.

In todays' global society, the Central banks role in constructively manipulating currency and interest rates INTERNALLY, is apparently doomed to failure by EXTERNAL forces BEYOND their control. Boom and BUST cycles are comiing closer together with extreme volutility that will be the demise, unless addressed, of the global financial system.

I suggest Global governments and Central banks, follow China's methodology on it's currency valuation, by picking the 30 - 50 currencies of the major economies and populations of the globe to form a "Currency Basket" that those currencies would be valued against, factoring in deficit spending, money creation, etc. and rewarding fiscal responcibility. The formation of a Currency Basket would, SHOULD, allow for "hedging", but ban speculation, and naked short selling.

Global trials and tribulation NEED a global solution(s).

JOBS 101: Start with analysizing EVERY product consumed, and or purchased, in the USA, as well as regionally, and the percentaged PRODUCED in the USA. Follow up by MANDATING 51% USA production vs importation... and that'll give room for new businesses established on USA soil ... whether by foreign companies, or USA established concerns employing USA citizens.