The Central Bank of Kuwait (CBK)  is afraid of speculation against its dinar,
just like George Soros speculated against the British pound sterling,
One of the reasons for this speculation would be the proposed Gulf Monetary Union (GMU).
( 2008/09/28 – CBK: Breaking the Bank
http://chartsandnumbers.com/2008/09/28/cbk-breaking-the-bank/ )

The CBK will however take the lead in achieving the GMU.

Great Britain joined the European Exchange Rate Mechanism (ERM) in October 1990. The ERM prevented the exchange rate between the pound sterling and other member currencies from fluctuating by more than 6%. In the wake of the rejection of the Maastricht Treaty by the Danish electorate in a referendum in the spring of 1992, and announcement that there would be a referendum in France as well, those ERM currencies that were trading close to the bottom of their ERM bands came under pressure from foreign exchange traders, says Wikipedia.

http://en.wikipedia.org/wiki/Black_Wednesday

Soros learnt from the President of the Bundesbank, the German Central Bank, Helmut Schlesinger, that he, the latter, was not quite happy with this fixed basket of currencies. Soros realised that just as the Italian lira was forced out of the ERM, the position of the pound sterling inside the ERM was untenable. He decided to throw the pound sterling out of the ERM when the British government increased interest rates by 2 percent in order to defend sterling.
(George Soros, “Soros on Soros”, John Wiley and Sons, 1995, pp. 81-82)

In May 2007, Kuwait has taken the bold step to depeg the dinar from the dollar and to peg the dinar to a basket of currencies.

The ERM was also a basket of currencies.

Britain was thrown out of that basket.

The dinar is pegged to a basket.

Speculation against the dinar cannot change the value of the basket to which the dinar is pegged.

Speculation against the dinar could only change the value of the dinar vis-à-vis that basket.

But then the dinar would no longer be pegged to that basket.
Indeed, in that case, the basket would be a freely floating reserve,
just like the gold and oil reserves of the GCC
will be the freely floating reserves of the GCC Single Currency (GSC).

In that case, every increase in the price of gold will lead to an increase in the value of the GSC.

At the present moment, the fact that the dollar is still being used as the intermediary numéraire for oil-trade settlement (as the intermediary basic “standard” by which values are measured for oil-trade settlement) gives this dollar-paper the backing of oil (oil becoming an indispensable valuable).

Once oil will see no more reason to support/back the dollar, oil will “openly” shift towards gold and back it (through demand for gold) so as to create the new market for physical gold in association with the gold-friendly euro-numéraire.

Oil will thus become the GSC.

I said four paragraphs ago that in the case of the gold and oil reserves of the GCC being the freely floating reserves of GSC, every increase in the price of gold will lead to an increase in the value of the GSC.
I now said that oil will be the GSC.
Put together, this means that every increase in the price of gold will lead to an increase in the price of oil (the GSC).

By depegging from the dollar, Kuwait has thus shown the way for the GCC to achieving the GSC, a freely high-floating price of oil.

The planned GMU is thus not a danger for the CBK, but an opportunity for the CBK to demonstrate how wise it, the CBK, was to depeg the dinar from the dollar.

ivocerckel@siquijor.ws

The Sunday Times is still maintaining that thalidomide had never been tested on humans.

From The Sunday Times
September 28, 2008
Thalidomide: Survival instinct
http://www.timesonline.co.uk/tol/life_and_style/health/article4818160.ece
SNIP
Found to be safe in animal trials, but never tested on humans, it was launched in 46 countries […]
+
Some were abandoned by parents too traumatised to cope, or sent to special boarding schools. They were issued with painful, ill-fitting false limbs to make them look more “normal”, and well-meaning surgeons removed fingers and toes for cosmetic reasons, removing what little dexterity they had.
+
Marjorie Wallace, now head of the charity Sane, who wrote the original articles, has kept in touch with many of the families. “When I first met the children at 9 and 10 years old, people believed they’d be in institutions for the rest of their lives,” she says. “If I took a child to a cafe, PEOPLE WOULD LEAVE. They couldn’t bear to look at these armless, legless bodies.
UNSNIP

Ivo:
Never tested on humans?
The whistle on thalidomide was blown at a congress of neurologists on 30 April – 1st May 1960 in Duesseldorf.

Gruenenthal only withdrew thalidomide from Europe on 27 November 1961.

Real-life testing does of course not qualify as “scientific” testing.

Just like real-life testing does not qualify as “scientific” testing,
so have René Descartes and Immanuel Kant conclusively demonstrated that sleevies must be attached to artificial limbs/prostheses,
prostheses, no hooks like in the movies.

Reality cannot bring in anything against that.

The movies have conclusively demonstrated that such a hook is useful
(in order to reduce the atrophy of the stump,
that is, in order to make the stump thicker or so).

That the hook only made the life of the thalidomide monster impossible
(and drove her to suicide at the age of eight, 8, no smiley please)
and that other children were even more afraid of the monster because of the hook
is of course of no importance whatsoever.

Of course, if the monster had been further amputated in order to fit the hooks …

Chronik des Conterganfalls
Tragödie – Katastrophe – Skandal?
http://www.wdr.de/themen/gesundheit/pharmazie/contergan/chronik.jhtml?rubrikenstyle=contergan
SNIPS
30. April/1. Mai 1960:
Auf einem Neurologen-Kongress in Düsseldorf berichtet der Neurologe Ralf Voss über die Nervenschädigungen, die seinen
Beobachtungen zufolge durch Thalidomid verursacht werden. Die Forschungsabteilung von Grünenthal versucht daraufhin, die Nervenschädigungen an Ratten zu reproduzieren – ohne Erfolg. Grünenthal-Forschungsleiter Mückter schließt daraus, dass es sich um besondere Situationen handelt, für die Contergan nur selten als Ursache infrage kommt.
+
27. November 1961:
Die Firma Grünenthal kündigt in einem Telegramm an das Düsseldorfer Innenministerium an, ihre Thalidomid-Präparate im In- und Ausland sofort aus dem Handel zu nehmen.
+
30. November 1961:
Eine Sachverständigen-Kommission, die das NRW-Innenministerium eingerufen hat, kommt zusammen. Die Experten erklären es für wahrscheinlich, dass Thalidomid Missbildungen hervorruft.Das amerikanische Arzneimittelunternehmen informiert Richardson-Merrill die US-Gesundheitsbehörde über die Ereignisse in Deutschland und zieht vier Monate später seinen Antrag auf Zulassung von Thalidomid zurück
Ivo:

If this German link does not work, try entering the title of the article in
http://www.google.de/

For example, girls who are born without or with impaired limbs are forced to wear prostheses when they are still infants, while reliable research has proved that this is detrimental to their identity development and results in more harm than help. Often these children are amputated in order to fit into the prostheses
(Womens Issues:
Disabled Women and the Right to Health Care
By Theresia Degener (degener AT efh-bochum DOT de)
Visiting Professor at UC Berkeley, School of Law
Professor of Law, Administration and Organization at University of Applied Sciences, Bochum, Germany
Presented at Hunter College, June 7th, 2000, New York
http://www.disabilityworld.org/Aug-Sept2000/Women/HealthCare.htm

The Glass-Steagall act – 1932 or 1933?

Inter-bank lending is paralysed?
I don’t get it.
I thought fractional-reserve banking allows banks to create money out of thin air. (1) (2)

The masters of the US of A are calling for a new Glass-Steagall act.
I don’t get it.

We are being told that
the Glass-Steagall act of 1933 established the Federal Deposit Insurance Corporation (FDIC) in the United States and that it included banking reforms, some of which were designed to control speculation

http://en.wikipedia.org/wiki/Glass-Steagall_Act

and that
the 1933 Glass-Steagall act which prohibited commercial banks from owning investment banks, and vice versa, has been steadily weakened since the 70s by an increasingly diverse and complex new financial reality.

http://blog.heritage.org/2008/09/22/the-glass-steagall-myth/

Here’s somebody who lived through it:
Benjamin M. Anderson, “Economics and the Public Welfare – A Financial and Economic History of the United States, 1914-46”, Indianapolis, Liberty Press, 1979, 2nd ed., (first ed. published in 1949 by D. Van Nostrand Company):

Anderson, p. 270
“The Glass-Steagall act”
In the first two months of 1932 there were further withdrawals of gold by foreign countries, and our gold monetary stock declined by $106,500,000. Our banks were under increasing pressure.
A remedy was found in the Glass-Steagall bill, introduced on February 11, 1932, rapidly put through Congress and signed by the president on February 27.

Ivo: that’s the Glass-Steagall act of February 27, 1932, not 1933.

Anderson continues on p. 270:
This act authorized the substitution of government securities for commercial paper as collateral or Federal Reserve notes for a period of one year. This was contrary to the original theory of the Federal Reserve act.

Anderson, p. 319:
The Glass banking bill, adopted June 16, 1933,

(Ivo: that’s Glass WITHOUT Steagall)

was a reform measure designed to prevent the abuses that had developed, particularly in the relation of the banks to the securities market, in the wild period, 1924-29.

Anderson continues on p. 319:
One sympathized with some of the provisions of the bill. But it went a great deal too far in dealing with symptoms. And it failed entirely to strike at the basic evil, which was the unsound Federal Reserve policy for the period 1924-28, which blew up the appalling bubble of stock market speculation and reckless securities issues.
+
One important provision of the act was that [it was] designed to effect a complete separation of commercial and investment banking.

Ivo:
That’s thus the Glass (WITHOUT Steagall) act of 1933

IVO’s QUESTION:

Do the masters of the US of A know what they are talking about?

The Glass-Steagall act of 1932 or the Glass (WITHOUT Steagall) act of 1933?

Right, even the number of L’s in “Steagall” is not clear.

Or shall we talk FreeGold,
the Glass-Steagall act, that is the act of 1932,
having been a response to withdrawals of gold by foreign countries?

ivocerckel@siquijor.ws

NOTES

(1)

http://en.wikipedia.org/wiki/Fractional-reserve_banking

Fractional-reserve banking is the banking practice in which banks are required to keep only a fraction of their deposits in reserve with the choice of lending out the remainder while maintaining the obligation to redeem all deposits upon demand. This practice is universal in modern banking.

(2)

http://en.wikipedia.org/wiki/Debt-based_monetary_system

Some critics of fractional reserve banking and the related monetary system may refer to it by the political term debt-based monetary system
+
Critics of fractional reserve usually note that the banking system “creates money out of nothing”. The insight that banks “create money by extending loans” is not new, and the subject is covered in most introductory economics textbooks and many popular reference works

Omstreden ‘Softenon’ terug in Nederland
Wubby Luyendijk
NRC 25 juni 2008, pas deze week in Google
http://insite.kahler.nl/sites/K/Kahler_nl/~uploads/editor/Nieuwsberichten/Lia_NRC_01.pdf

Ivo’s Commentaar:

1.
Softenon, thalidomide, was reeds bekend in 1938 door Richardson-Merrill Co. in Cincinnati, Ohio, VS van A.

De monsterverwekkende (teratogene) eigenschappen van softenon werden daar opgemerkt door ene dokter Frances Oldam Kelsey, tewerkgesteld bij die Richardson-Merrill Co.

Softenon was in de handel sinds 1957.

Pas in 1960 werd Kelsey bij de Food and Drug Administration (FDA) van de VS van A benoemd.

In 1962 werd Kelsey nochtans door president Kennedy van de VS van A bekroond met een presidential award omdat zij de VS van A (sinds 1957) had bewaard van softenon.

Sofenon werd sinds 1957 verhandeld en Kelsey werd pas in 1960,
(na het hiernavermelde congres in Duesseldorf, vermoed ik)
bij de FDA benoemd?

2.
De gevolgen van softenon werden publiek gemaakt op een congres van neurologen in Duesseldorf op 30 april – 1 mei 1960.

Gruenenthal, de fabrikant van softenon in Aken, kan niet stellen dat zij dat niet wist.

Gruenenthal nam softenon enkel van de markt op 27 november 1961.

En dan komt Gruenenthal stellen dat
behalve in Ierland en enkele andere landen waar zij softenon rechtstreeks verkocht,
de schade toegebracht door softenon dient gedragen door de licentiehouders.

“Fraus omnia corrumpit” was enkel goed voor de Romeinen.

Wij zijn moderner. Wij kennen het algemeen belang.

3.
Thans heeft het het Koninkrijk der Nederlanden behaagd om, in naam van het algemeen belang, softenon terug op de markt te brengen.

De menselijke natuur, de menselijke aard, is zo opgesteld, ingesteld of afgesteld dat personen met insider kennis van de gevolgen van softenon voor de foetus altijd, opzettelijk en onopmerkelijk de schade zullen toebrengen die softenon zo gemakkelijk kan teweeg brengen.

Deze individuen doen dat precies omdat de schade aan de moeder en het kind zo ernstig is en omdat de schade zo gemakkelijk kan toegebracht worden, zonder betrapt te worden.

Het is mogelijk dat in klinische testen, softenon, precies omwille van haar (teratogene) eigenschappen die 50 jaar geleden zogezegd onbekend waren, nuttig is tegen van alles en nog wat, maar in het werkelijke leven wordt softenon gegeven aan nietsvermoedende zwangere meisjes.

Of zal een utilitarist komen vertellen dat deze schade afgewogen dient tegen de levens die door softenon kunnen gered worden?

Misschien dient de utilitarist erop gewezen dat ook jonge dokters onwetend zijn van de gevolgen van softenon, vooral in die landen waar softenon nooit een probleem is geweest.

En als u mij niet gelooft, kom me dan bezoeken in dit land waar softenon wel een probleem is geweest. Ik zal u hier in het dorp het softenonmonstertje tonen dat hier in 2006 of 2007 geboren werd.

Het utilitarisme is de ethische leer die stelt dat de morele waarde van een handeling enkel bepaald wordt door haar algemeen nut, de maximalisering van het geluk van allen.

In de Zuidelijke Nederlanden werd daarom gevierd (ik weet niet of het voltooid deelwoord van “juichen” met d of t is) toen de moordenaars van softenonmonsters vrijuit gingen voor het hof van assisen in Luik.

Friday, 7 June, 2002, 14:43 GMT 15:43 UK
Thalidomide: 40 years on
http://news.bbc.co.uk/2/hi/uk_news/2031459.stm
UITREKSEL
In 1962, a Belgian woman was found not guilty of murdering her thalidomide baby.
There was much celebration in Liège when she and her co-accused – her mother, sister, husband and the family doctor – walked free. UNSNIP

Voor meer – zie mijn Thalidomide – Dishonest Drug
http://bphouse.com/honest_money/2008/04/06/dishonest-drug/

indien de aldaar geciteerde Duitse links niet werken, voeg dan de titel van artikels in in
http://www.google.de/

DDP-Meldung vom 25.09.2008, 11:50 Uhr
Contergan-Opfer setzen Hungerstreik fort
http://www.dernewsticker.de/news.php?id=47171
UITREKSEL
Bergisch Gladbach (ddp-nrw). Die im Hungerstreik befindlichen Contergan-Opfer wollen ihre Aktion in einer evangelischen Kirche in Bergisch Gladbach weiter fortsetzen. Eine Woche nach Beginn des Hungerstreiks sei die Stimmung in der Gruppe gut. Man erfahre viel öffentliche Unterstützung, sagte ein Sprecher am Donnerstag auf ddp-Anfrage. Der gesundheitliche Zustand der Streikenden sei «den Umständen entsprechend».

HAHAHA
September 23, 2008
How Thalidomide Works
http://news.bloglicio.us/2008/09/23/how-thalidomide-works/
UITREKSEL
The thalidomide tragedy could not have been foreseen because the combination effect had not been observed previously, or even suspected.Wuest insisted, however, that “the tools are now available” to preventthe repetition of such a disaster, if drug researchers take care totest their compounds in animals such as the rhesus monkey

ivocerckel@siquijor.ws

The implications of GMU are fundamentally economic, but money is fundamentally about politics or national pride. (1) In order to avoid the issues of politics, the constitutional law of the GMU should limit the GMU to the marking to market (MTM) of the gold, oil and foreign exchange reserves of the GCC states.

My “GMU and GCB – the chicken and the egg”-post established that the institutions should come before the union. (2) My “Oil is the GCC Single Currency”-post established what its title says. (3)

The finance and economy ministers of the Gulf Co-operation Council (GCC) last week approved proposals to set up the Gulf Monetary Council (GMC) and a draft charter for a Gulf Monetary Union (GMU). I am not sure the name “Gulf Monetary Authority” (GMA) has yet been dropped for the GMC, but in the interests of simplicity, I will only refer to the Gulf Central Bank (GCB)’s precursor as the GMC.

We are being told that the GMC is being modelled after the European Monetary Institute (EMI) which was the precursor to the European Central Bank (ECB).

Whereas some in the GCC doubt whether the Monetary Union will be achieved by 2010, in Europe, it was the detailed and credible preparations of European Monetary Union (EMU) by the EMI, which was created in 1994, and other bodies which was one of factors leading to the growing conviction that EMU would be launched on time, that is, that EMU would be launched on 1st January 1999. (4)

The Dubai International Financial Centre (DIFC) is now arguing that it would be a waste of time to set up an institution that in a few months would cede powers to the GCB. (5)

A Commentary, published on 19 September 2008 in MEED, Middle East Business Intelligence, argues that in order to reap the benefits of GMU (and of the GCC Railway project), GCC Member States will have to exhibit a degree of common sense and swallow a lot of national pride to reap these benefits. (6)

In essence, a monetary union entails relinquishing some of the national government prerogatives and assigning them to independent supranational bodies. This transfer of power can be achieved only if there is mutual trust among member countries, says the DIFC. (7)

If a group of states conclude a set of treaties to govern their relations with each other in a given area, international law permits them to create a new system of law that is self-contained and separate from international law. (8) They are free to decide how they do it.

The GMU Treaty will set out the objectives and purposes of the GMU, create the institutions of the GMU, define the powers of those institutions and regulate their relations both inter se (among themselves) and with the Member States. This should then become the source of the constitutional law of the GMU. (9)

The GCC will have to swallow a lot of national pride, says MEED.

It should however not be forgotten that even the members of Eurosystem, which comprises the European Central Bank (ECB) and the national central banks of those countries that have adopted the euro, have not swallowed all their national pride, that the system is therefore much too decentralised and that the influence of the national central banks in the Governing Council, the ECB’s main decision-making body, is too great so that national interests will tend to prevail at the expense of system-wide interests. (10)

In my “Oil is the GCC Single Currency”-post, I was arguing what its title says and I also said that oil (the GCC Single Currency, GSC) is the only commodity in the world that is large enough for gold to hide in.

Gold thus hides in oil. Its value is inside oil.

Since 15 August 1971 and the emptying (on a later date) of the gold vaults at Fort Knox, the US dollar has no value whatsoever.

I will now turn to texts from Islam. I am not Muslim. I want however to understand how Islam thinks about money. I therefore quote. I do apologise in advance if I offend Islam. That is not my intention. I am not aware of offending Islam. My intention is to understand and promote GMU. I may even not take Sunni-Shia relations into account, but I am however not aware that I am doing this.

There is a Hadith of Prophet Muhammed in the Sahih Muslim which teaches:
“Abu Said Al Khudri reported Allah’s messenger as saying: “gold for gold, silver for silver, wheat for wheat, barley for barley, dates for dates, and salt for salt. (When a transaction is) like for like, payment being made on the spot, then, if anyone gives more or asks more, he has dealt in riba (usury), the receiver and the giver being equally guilty.”

This Hadith of Prophet Muhammed establishes two things:
ONE ‘money’ in Islam is either precious metals such as gold and silver, or commodities such as wheat, barley, dates and salt.
TWO when gold, silver, wheat, barley, dates and salt were used as money, their value was ‘inside’ and not outside’ the money. Hence, it is established that ‘money’ in Islam must possess intrinsic value. (11)

On 18 August 1991, Muslims in Granada issued a fatwa on the use of paper money as medium of exchange:
“After examining all the aspects of paper money in the Light of the Qur’an and the Sunnah, we declare that the use of paper money in any form of exchange is usury and therefore haram. It is not permitted for the Muslim to accept or to give paper money in a commercial transaction. It is an obligation on the Muslims to abandon usury and to introduce new media of exchange, or money, and the best way is to follow the sunna of the Messenger of Allah, salallau alaihi wa salaam, by using gold and silver, or any other merchandise commonly accepted as a medium of exchange”.(12)

This ruling, which is not universally shared by Muslims, seems to argue that nowadays paper money has been reduced to a pure symbol with no reality attached to it except imposition of the law. (13)

Compare this to what former ECB President Duisenberg, said in his Charlemagne speech of 2002, that is, that money is in essence a social contract. (14)

I repeat I am not Muslim. I want however to understand how Islam thinks about money. I therefore quote. I do apologise if I offend Islam. I am not aware I am doing this. I add that I am not even versed in Islamic law.

Fundamentally, Islamic sharia principles forbid interest but do not prohibit at all gains on capital. Sharia law simply requires that the performance of capital must be taken into account when rewarding capital. Therefore, in financial terms, the use of capital must add value and not be devoid of risk. (15)

If the Qur’an, the Sunna and the Ijma (consensus),
[I, Ivo, don’t know whether the Sahih Muslim is of one of these.
If the Sahih Muslim is not part of one of these three, my reasoning is invalid.]
fail to provide a rule to solve the problem at hand, jurists must strive by deep and devoted study to derive an appropriate rule by logical inferences and analogy. Such resort to reasoning was called ijtihad, and logical reasoning by analogy was known as qiyas and was the subject of much philosophical inquiry in sorting out the principle and separating it from the particular facts of the past and present cases. (16)

Only a scholar known as mujtahid was equal to this task of adapting Islamic law to the changing needs of a rapidly expanding and developing society. (17)

The task of the mujtahid is to discover the ahkam of the shari’ah from the texts. The task of the jurist after a study of the primary sources is to:
- discover the law that is either explicitly in the primary sources or is implied by the texts, that is, discover it through literal interpretation
- extend the law to new cases that may be similar to cases mentioned in the textual sources, but cannot be covered through literal methods, and,
- extend the law to new cases that are not covered by the previous two methods, that is, they are neither found explicitly or implied in the texts nor are they exactly similar to cases found in the texts. (18)

It is unlikely that the proved power of Islamic law to respond to the accelerating rate of social change will not manifest itself once more in our age as it has done in the past. (19)

I am not a mujtahid, so who am I to try to interpret?

The changing needs of society seem however to make it necessary to define the GSC (oil) not like the old gold standard, as a certain quantity of gold, but to use gold in reserve as a freely trading financial reserve.

As I quoted, fundamentally, Islamic sharia principles forbid interest but do not prohibit at all gains on capital. Sharia law simply requires that the performance of capital must be taken into account when rewarding capital. Therefore, in financial terms, the use of capital must add value and not be devoid of risk. (15, again)

With gold in reserve as a freely trading financial reserve, each increase in the price of gold will bring about an increase in the value of the GSC (oil)’s reserves and thus an increase in the value of the GSC (oil) itself.

Currencies can indeed only remain competitive if their value is not a fixed quantity of gold but is dependent upon the amount and value of the gold their emitting bank holds in reserve.

The more gold, the GSC (oil) would have in reserve and the more the price of gold increases, the higher would be the value of the GSC (oil).

The old gold standard did not provide for the possibility that an increase of the ounces, kilograms, or tonnes of gold held in reserve would lead to an increase in the currency’s value.

But I am not Muslim and certainly not a mujtahid. I want however to understand how Islam thinks about money. I therefore quote. I do apologise if I offend Islam. That is not my intention. I am not aware of offending Islam. My intention is to understand and promote GMU.

The GSC (oil with gold hiding in it) seems to be a step in the direction of money with intrinsic value, adapted to the changing needs of society.

Or will it be argued that oil (and gold) has (have) no value?

Prophet Muhammad (sallalahu ‘alaihi wa sallam) gave to the world an economic order that was free from economic injustice and oppression. No one worked for slave wages. Wealth did not circulate only amongst the wealthy but, rather, throughout the economy. The rich were not permanently rich and the poor were not permanently poor. There was, therefore, no need for any minimum wage legislation. The market was a free and a fair market. No one could ‘reap’ without ‘planting’. Money had intrinsic value and so it could not be manipulated by banks and by a predatory elite to reduce its value. In consequence, such a market and economy never experienced ‘inflation’. No prices were fixed, including the price of labour. Social welfare was achieved in the form of a compulsory tax on wealth that was used to provide for those who did not possess the basic necessities of life. But the value system of the society ensured that the effort would always be made, by those who were capable of such effort, to extricate themselves from having to live off that charity. (20)

ivocerckel@siquijor.ws

NOTES

(1)
Francis Snyder, “EMU Revisited – Are we Making a Constitution? – What Constitution are we Making?”, European University Institute, Florence, Department of Law, EUI Working Paper LAW No. 98/6, July 1998

http://cadmus.eui.eu/dspace/bitstream/1814/142/1/BS-EMUWOR-FS.pdf.

p. 31
Jacques Rueff was only partly correct when (and if) he stated that “L’Europe se fera par la monnaie ou elle ne se fera pas”. He neglected to add that money is politics. Had he done so, he might have observed that “L’Europe se fera par la politique ou elle ne se fera pas”. At least with regard to EMU one thus may assert that the last word about EMU belongs to the political class and those segments of the broad public which in one way or another participate in politics but not completely.

(2)
GMU and GCB – the chicken and the egg
September 18th, 2008 by Ivo Cerckel

http://bphouse.com/honest_money/2008/09/18/gmu-and-gcb-the-chicken-and-the-egg/

(3)
Oil is the GCC Single Currenc
September 21st, 2008 by Ivo Cerckel

http://bphouse.com/honest_money/2008/09/21/oil-is-the-gcc-single-currency/

(4)
Desmond Dinan, “Ever Closer Union – An Introduction to European Integration”, Macmillan, 1999, 2nd ed., p. 427

(5)
Nasser Saidi, Fabio Scacciavillani, Aathira Prasad, Fahad Ali, “The institutional framework of the Gulf Central Bank”, Dubai International Financial Centre, September 2008

http://www.difc.ae./files/080913_DIFC_IFGCB%20Book.pdf

(6)
Commentary in MEED: Middle East Business Intelligence
“Monetary union and GCC Railway: Gulf states should swallow pride”
Published: 19 September 2008 14:29 GMT  http://www.meed.com/commentary/2008/09/monetary_union_and_gcc_railway_gulf_states_should_swallow_pride.html

(7)
Saidi, et alt., op. cit., p. 12

(8)
Trevor C. Hartley, “The Foundations of European Community Law”, Oxford University 2007, 6th ed., p. 83

(9)
I am paraphrasing what
Lasok and Bridge, “Law and Institutions of the European Communities”, Butterworths, 1991, 5th ed.., p.  213
were teaching concerning the European Communities

(10)
Paul De Grauwe, “Economics of Monetary Union”, Oxford University Press, 2007, 7th ed., p. 181

(11)
Imran N. Hosein, “Explaining the Disappearance of Money with Intrinsic Value”, paper delivered at the International Conference on the Gold Dinar Economy, held in Kuala Lumpur on 24 and 25 July 2007,. p. 1

(12)
Joseph A. DiVanna, “Understanding Islamic Banking – The Value proposition that Transcends Cultures”, Cambridge, UK, Leonardo and Francis Press, 2006, pp. 140 – 141

(13)
Joseph A. DiVanna, op. cit., p. 141

(14)
International Charlemagne Prize of Aachen for 2002
Acceptance speech by Dr. Willem F. Duisenberg, President of the European Central Bank, Aachen, 9 May 2002

http://www.ecb.eu/press/key/date/2002/html/sp020509.en.html

(15)
Joseph A. DiVanna, op. cit., p. 2

(16)
C.G. Weeramantry, “Islamic Jurisprudence – An international Perspective”, Kuala Lumpur, The Other Press, 2001, p. 40

(17)
C.G. Weeramantry, op. cit., p. 41

(18)
Imran Ahsan Khan Nyazee, “Islamic Jurisprudence (Usul al-Fiqh)”, New Delhi, Adam Publishers and Distributors, 2004, p. 264

(19)
C.G. Weeramantry, op. cit., p. 45

(20)
Imran N. Hosein, “Jerusalem in the Qur’an – An Islamic View of the Destiny of Jerusalem”, Long Island, New York, Masjid Dar al-Qur’an, 2002, p. 213

oil pricing in GSC will make dollar peg unsustainable

Gold is wealth. Oil is the only commodity in the world that is large enough for gold to hide in.

Oil is money. Oil is the GCC Single Currency (GSC). GCC is the Gulf Co-operation Council.

The 1944 Bretton Woods system linked the US dollar to gold at fixed parity of 42 dollar an ounce or so and all other currencies, also at fixed parity, to the said dollar.

USA president Richard Nixon repealed that system on 15 August 1971.

Before 15 August 1971 the dollar was backed by gold.
Since then, the dollar is backed by “usage demand” of dollar for oil (the GSC), oil (the GSC) still being priced in dollar. People need to use the dollar to buy oil (the GSC). The dollar is thus being backed by this need, the buyers of the dollar demanding dollars in order to be able to buy oil (the GSC).

The world currency system has for years also been little more than digital credits backed by “usage demand”.

It is the oil (the GSC) backing of the dollar that has kept it all together up till now, untapped oil (the GSC) reserves having the same wealth-consolidating function as gold.

The opportunity for the world monetary system, which some call a threat to that system, is a function of this oil (the GSC) pricing.

The fact that the dollar is still being used as the intermediary numéraire for oil-trade settlement (GSC-trade settlement), as the intermediary basic “standard” by which values are measured for oil-trade settlement, gives this dollar-paper the backing of oil (the GSC becomes an indispensable valuable).

Once oil (the GSC) will see no more reason to support/back the dollar, oil (the GSC) will “openly” shift towards gold and back it (through demand for gold) so as to create the new market for physical gold in association with the gold-friendly euro-numéraire.

It was once said that “gold and oil (the GSC) can never flow in the same direction”. If the current price of oil (the GSC) doesn’t change soon, we will no doubt run out of gold. This line of thinking is very real in the world today but it is never discussed openly.

You see oil (the GSC) flow is the key to gold flow. It is the movement of gold in the hidden background that has kept oil (the GSC) at these low prices. Not military might, not a (previously) strong US dollar, not political pressure, no it was real gold. In very large amounts.  Oil (the GSC) is the only commodity in the world that was large enough for gold to hide in.

The September 2008 Dubai International Financial Centre “The institutional framework of the Gulf Central Bank”-paper contains a table on page 7 giving the oil reserves of the GCC countries but does not elaborate on the reason why it gives that table, be it that, on page 4, it says that the stability of the newly created strong currency is guaranteed by oil wealth and increasingly by financial wealth.

Five of the six GCC currencies are still pegged to the dollar.
Oil, the future GSC, is still being priced in dollar.

Once the GSC will arise, oil (the GSC) will be priced in the GSC, thus no longer in dollar.

With gold hiding in oil (the GSC) as a freely floating reserve, it is an open question whether the dollar peg will not have to go by the same token, the dollar still being pegged at 42 dollar or so to an ounce of gold.

ivocerckel@siquijor.ws

WEBOGRAPHY

Date: Sun Oct 05 1997 21:29
ANOTHER ( THOUGHTS! ) ID#60253:

http://www.usagold.com/goldtrail/archives/another1.html

Nasser Saidi, Fabio Scacciavillani, Aathira Prasad, Fahrad Ali, The institutional framework of the Gulf Central Bank, Dubai International Financial Centre. September 2008

http://www.difc.ae./files/080913_DIFC_IFGCB%20Book.pdf

The unexamined life is not worth living …

USA president Bush said yesterday that his administration would meet the serious challenges facing markets amid a fast-deepening global financial crisis. The serious challenges are being faced by the market, not by the Bush administration,. Why does the administration intervene?

The fiat-money system is fraudulent.

A short sale is the sale of a security or other asset an investor has borrowed. The short-seller will have to purchase the asset eventually in order to repay what he has borrowed; thus he profits from a fall in the asset’s price.

Why should prices always go up? Why can they not go down?

Yesterday, Thursday, thalidomide monsters, like myself, had to go on hunger strike in Bergisch Gladbach in order to obtain higher compensation from the manufacturer, Gruenenthal, 50 years after the facts.

You think those events are not linked?

I’ll tell you. There are no more standards for human action.

The kind of examination of life to which Socrates devoted himself is the branch of philosophy called “ethics” or “moral” philosophy. Ethics is a rational inquiry into how to act and to lead one’s life.

Give FreeGold a chance!

The jury almost certainly would have acquitted Socrates if he had agreed to give up his practice of going about Athens interrogating its citizens concerning the ultimate questions of human existence  …

ivocerckel@siquijor.ws

18.09.2008 – 09:05
Neue Initiative von Contergan-Opfern.
http://www.kobinet-nachrichten.org/cipp/kobinet/custom/pub/content,lang,1/oid,18963/ticket,g_a_s_t

Bergisch-Gladbach: Contergan-Opfer im Hungerstreik
http://www.sr-online.de/nachrichten/29/818620.html

18.09.2008 | 17:57 Uhr
Contergan-Opfer im Hungerstreik
http://www.ad-hoc-news.de/Contergan-Opfer-im-Hungerstreik–/de/Wirtschaft-Boerse/Arbeit-Soziales/19573738

Dishonest Drug
http://bphouse.com/honest_money/2008/04/06/dishonest-drug/

Here’s an Emirates Business 24/7 article of 25 August 2008.

GCC monetary union key to setting up a central bank
25 August 2008
http://www.zawya.com/printstory.cfm?storyid=ZAWYA20080825030212&l=030200080825

The first paragraph of the article says:
A Gulf Monetary Union should be a stepping stone to the formation of a Gulf central bank, said Dr Nasser Al Saidi, Chief Economist at the DIFC.

Ivo:
A stepping stone is a means of achievement, says Random House Webster’s dictionary.
GMU is a means of achieving a GCB, says the first paragraph.

The second paragraph of the article says:
“One of the critical steps in the preparation for monetary union is the definition of the institutional and governance structure and design of the Gulf central bank. In this area there has been an intense debate among the GCC authorities, but little has transpired so far. This is the last major hurdle on the road to monetary union,” Dr Al Saidi said.

Ivo;
The second paragraph says that the definition of the institutional and governance structure and design of the GCB is a necessary condition for the preparation of GMU.
The second paragraph thus says that the GCB is a means of achieving GMU.

CONCLUSION
GMU is a means of achieving a GCB, says the first paragraph.
The second paragraph says that the GCB is a means of achieving GMU.

Oil producers are converting their petrodollars into the tangible wealth of gold.
That’s why both are linked.

Once gold will assume its correct value, oil will also assume its correct value.

Both will be marked to market (MTM).

If oil does not follow gold’s rise, oil producers will no longer be able to convert their petro-eurogulfs to gold at the same rate as now.

As I said this morning in
Gold is wealth – September 18th, 2008 by Ivo Cerckel
Ben Bernanke, chairman of the US central bank, has lost control. Gold and oil wealth now controls everything.
http://bphouse.com/honest_money/2008/09/18/gold-is-wealth/

Monika Malik, chief economist at EFG-Hermes Holding, Egypt’s largest investment bank, does not like that

She thinks that Gulf Monetary Union (GMU) is about a single currency.

Oman thinks otherwise.

Oman thinks that GMU is about pooling the gold reserves of the GCC states and marking these reserves to market.

That’s what  the GCC Rulers will endorse in November 2008.

They will meet to that effect in November 2008  in … Muscat.

And yes, Muscat is the capital of … Oman.

From The Times
September 18, 2008
Gulf finance ministers back single currency plan
Sonia Verma in Dubai
http://business.timesonline.co.uk/tol/business/economics/article4775451.ece
SNIP
Furthermore, as a unified trading bloc, the Gulf would raise its profile on the world stage, allowing it to leverage its oil wealth collectively.
Detractors argue that it would never work in a region ruled by autocrats. Monica Malik, chief economist at EFG-Hermes said: “The easy bit is what they’ve just agreed to. The hard part is coming up.”
“You have to take this with a grain of salt. Because the Gulf economies are so similar to each other, the trade possibilities are not as pronounced,” Eckart Wörtz, an economist with the Gulf Research Centre in Dubai, said.

For Oman, GMU is MTM of gold reserves by GMA/GMC
September 16th, 2008 by Ivo Cerckel
http://bphouse.com/honest_money/2008/09/16/for-oman-gmu-is-mtm-of-gold-reserves-by-gmagmc/

ivocerckel@siquijor.ws