Iceland recap - Revenge of the Vikings - Iceland Will Create Its Own Money

[Zenaan Harkness]

Those plucky Icelandics - let's wish them better luck than JFK and
others. Abundance is merely an engineering problem, and unfortunately
is opposed by hegemony of the few, so good luck to Iceland.

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http://russia-insider.com/en/revenge-vikings-iceland-will-create-its-own-money/ri14036

Revenge of the Vikings - Iceland Will Create Its Own Money

Well, they were game enough to jail their bankers; let's see if
they'll get away with this
(Blacklisted News)

The banking elite won't like this one bit

Originally appeared at Blacklisted News
http://www.blacklistednews.com/Revenge_of_the_Vikings_%E2%80%94_Iceland_Will_Create_Its_Own_Money/50647/0/38/38/Y/M.html


Back in 1914, the Bradbury Pound (
http://www.ukcolumn.org/bring-back-the-bradbury ) was introduced by
the UK government as an ’emergency measure’ to bolster a failing
economy.

It was a huge success. The banking elite were unhappy, however and
panicked – before managing to wrestle control of the money supply
afterwards.

President John F. Kennedy also introduced a similar ‘Greenback’ in
1961, and again, the banking elite were very unhappy about being
pushed out, and losing control of the issuance of money as debt. JFK
did not survive past 1963.

Then there was Muammar al-Gaddafi in Libya who, in 2009 announced a
new gold-backed dinar, issued by Libya’s state-owned public central
bank ( http://21stcenturywire.com/2011/03/28/globalist-target-the-central-bank-of-libya-is-100-state-owned/
), and with further plans – negotiating with the other African nations
for the creation of an all-African currency to compete with the Euro
and the Dollar. Gaddafi did not survive past 2011.

Who knew that the revolution would start with those radical Icelanders?

One Frosti Sigurjonsson, a lawmaker from the ruling Progress Party,
issued a report that suggests taking the power to create money away
from commercial banks, and hand it to the central bank and,
ultimately, Parliament.

Can’t see commercial banks in the western world be too happy with
this. They must be contemplating wiping the island nation off the map.
If accepted in the Iceland parliament, the plan would change the game
in a very radical way.

It would be successful too, because there is no bigger scourge on our
economies than commercial banks creating money and then securitizing
and selling off the loans they just created the money (credit) with.

Everyone, with the possible exception of Paul Krugman, understands why
this is a very sound idea. Agence France Presse reports:

Iceland’s government is considering a revolutionary monetary proposal
– removing the power of commercial banks to create money and handing
it to the central bank.


The proposal, which would be a turnaround in the history of modern
finance, was part of a report written by a lawmaker from the ruling
centrist Progress Party, Frosti Sigurjonsson, entitled “A better
monetary system for Iceland”.

    “The findings will be an important contribution to the upcoming
discussion, here and elsewhere, on money creation and monetary
policy,” Prime Minister Sigmundur David Gunnlaugsson said.

The report, commissioned by the premier, is aimed at putting an end to
a monetary system in place through a slew of financial crises,
including the latest one in 2008.

According to a study by four central bankers, the country has had
“over 20 instances of financial crises of different types” since 1875,
with “six serious multiple financial crisis episodes occurring every
15 years on average.”

Mr Sigurjonsson said the problem each time arose from ballooning
credit during a strong economic cycle.

He argued the central bank was unable to contain the credit boom,
allowing inflation to rise and sparking exaggerated risk-taking and
speculation, the threat of bank collapse and costly state
interventions.

In Iceland, as in other modern market economies, the central bank
controls the creation of banknotes and coins but not the creation of
all money, which occurs as soon as a commercial bank offers a line of
credit. The central bank can only try to influence the money supply
with its monetary policy tools.

Under the so-called Sovereign Money proposal, the country’s central
bank would become the only creator of money.

    “Crucially, the power to create money is kept separate from the
power to decide how that new money is used,” Mr Sigurjonsson wrote in
the proposal.

    “As with the state budget, the parliament will debate the
government’s proposal for allocation of new money,” he wrote.

Banks would continue to manage accounts and payments, and would serve
as intermediaries between savers and lenders.

Mr Sigurjonsson, a businessman and economist, was one of the
masterminds behind Iceland’s household debt relief programme launched
in May 2014 and aimed at helping the many Icelanders whose finances
were strangled by inflation-indexed mortgages signed before the 2008
financial crisis.