Money Beyond Manipulation …

Voices are being heard suggesting that in these troubled times the gold standard should be re-introduced to give money some intrinsic value. Those who remember the pre-1971 era of gold-backed money know that this does not prevent the manipulation of currencies by speculators.

Here is a wholly new alternative, called the ‘the Objective Money’ solution. This writer first proposed this in the 1980s. It values money against the energy balance sheet of a nation or community, and bases itself on a unit of energy measurement called the “Erg” (its root is ‘ergon’, the Greek for ‘work’). This is essentially a measure of energy, energy is the stuff that everything is made of (“matter is energy reduced to visibility”). There is international agreement on the Erg as a standard of measurement.

The potential or actual energy of everything is measurable – we know what one horsepower is; we know how much energy a gallon of refined oil contains (depending on the efficiency of conversion); and we can measure the potential energy output of a healthy human, between the ages of 18 and 50, to give us a new unit, that of one human power; etc. In fact, the actual and potential energy of the world, as well as of individual nations or communities, can be calculated in terms of potential and realised energy. This listing, which takes solar power, wave-power, human power, etc. into account, represents the credit side of a nation’s balance sheet.

The debit side will contain a listing of wasteful energy consumption, e.g. numbers of gas-guzzling cars; per head power consumption; numbers of electrical appliances, etc. Add these up, and we have the negative side of the balance sheet. The differential between the two sides represents the value backing of this country’s currency.

The US Dollar, usually considered one of the world’s strongest currencies, under this objective formulation would slip into the middle ranks, in value terms, because of the enormous amount of energy wastage that occurs there, and its huge volume of energy imports (which is an energetic “cost” item). A Middle Eastern oil-rich country on the other hand, sitting on huge oil-reserves (= potential energy), plus plenty of potential solar energy, will show a very healthy positive side to the balance sheet. The negative side, by virtue of typically smaller populations, even with highly wasteful energy consumption patterns, will remain relatively modest. Because of the huge positive energy balance backing such a country’s currency, it would quickly be recognised as one of the strongest currencies in the world.

Another benefit of an energy-balance linked monetary system would be that a poor country like Bangladesh would no longer linger at the bottom of wealth league tables as its currency would have strengthened due to the large amounts of potential energy locked within its population and national boundaries.

The other joy of an energy-linked, objective currency system is that it takes the valuation of currencies out of the hands of speculators and places it back with governments and their people – if they find new sources of energy supply; develop better ways of releasing potential energy; and of reducing energy consumption, they will be able to put more genuine value behind their currency, so affecting their exchange rate and international standing.

The perceptive reader will immediately see the wider impact of such an objective energy-linked currency model. The Light Living Laboratory will in due course expand on this (a fuller version of this blog appears there).

5 thoughts on “Money Beyond Manipulation …

  1. Facinating concept. How would you value a nations currency if let say the e-cat by Rossi in Bolognia was perfected and it was possible so every home could have it own unlimited source of nonpulluting energy. Every car and aircraft could drive and fly for years without problems? I think in the not to far off future huge inovations in clean energy inovation will revolutionize this Planet and save alot of peoples lives by not fighting about oil or coal type of values.

    • The e-cat by Prof Rossi serves as a wonderful illustration of how a country could strengthen its energy-balance (and therefore currency) through ingenuity and inventiveness : the production of the e-cat, as well as the start–up boost, will represent one-time, small, negative entries in Italy’s energy balance sheet, and will then contribute its rated energy production for the remainder of its life (which, from my past involvement in similar technology, could be as much as 40 years). Depending on how sophisticated one wants to make the model, it would be possible to add some weighting to energy from this source as it is ‘clean’ – http://coldfusion3.com/blog/bologna-e-cat-test-a-success.

  2. Pingback: Objective Money Solution | Jeff Eisen, Ph.D.

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