By Dr. Moyi Harry Ruben
The prognosis for the Gold and Dollar for the international monetary system is unattractive indeed. Without radical reform, the international system is destined to shift back and forth between fixed and fluctuating exchange rate with each system posing unsolved problems of working back, and finally the money launderers, disinteresting and fueling this disintegration will be the continued inflation of the supply of South Sudanese Pound and hence Commodity prices which show no sign of narrowing. The prospect for the future is accelerating and eventually runaway inflation at home due to dollarization of the economy, accompanied by monetary breakdown and economic warfare abroad on borrowed funds. This prognosis can only be changed by a drastic alteration of the South- Sudan and world monetary system by the return to a free marketed commodity money, such as gold. Although, this may not be possible for South Sudan due to the international economic order that had integrated into the chaos of clean and dirty floating exchange rates that is being advocated in the country and by removing government totally from the Bullion scene. Buying Gold from local market by Central bank and keep, do not change the status of our economy and purchasing power of our currency. 1. Classical Gold standard 1815-1914 cannot be revived because this was replaced by Bretton Woods and the New Gold Exchange Standard 1945-1968 which was later driven through by the United States at the international Conference at Bretton Woods New Hampshire 1944. This was replaced by the Unraveling of Bretton Woods 1971. All countries national Currencies should not be redeemable in Gold but by Dollar and all Gold shall be in a National Treasury of the Government not in the Central Bank. 2. Gold is traded in the International Financial Markets like other Commodity and must be graded so that it can influence the redeemability of the national Currency, otherwise, buying Gold and Keeping it, is not viable to the economy and cannot influence the purchasing power parity of the south Sudanese pound. 3. Gold Bullions are not currently legal tender, but can be traded in the international Financial Capitals i.e., Shanghai, New-York, Tokyo, Singapore, London, Dubai and other financial capitals Globally. Here, then, the National Gold Bullions could influence the national Currency. Hence Keeping Raw Gold is not the best option as suggested by some economists. 4. Gold Bullion do not appear in the Financial Statements of Financial Institutions and therefore, these Gold can easily be misappropriated and end up in the hands of other people for personal gain. The idea that the central bank will have to buy Gold to strengthen the value of the pound is not an option to reduce inflation. Central bank is a government Bank; therefore, a government cannot buy itself. (Gold belong to the Treasury). If the classical gold standard worked so well, why did it break down? It breaks down because governments were entrusted with the task of keeping their monetary promises, of seeing to it that pound, dollars, and other currencies were always redeemable in Gold as they and their controlled over banking system had pledged. So, it was not gold that failed, it was the folly of trusting government to keep its promises to redeem warehouse receipts in Gold. We seemed to have been abandoning our own Currency and prefer the Dollar, no country could afford to abandon its currency and use the currency of another country, except South Sudan, Zimbabwe and Venezuela. Otherwise, all payments must be influenced by local currency of the country like in Sudan, Tanzania, Uganda and others. So, the economists should take on careful studies to find reasons why we are about to move away from our pound and opt to Dollar. Your Currency is strength or image of the Country.
When we close one eye, we see half way which ever eye you close. When we take decisions, we may not understand the chemistry of the issue. When we do not solve the smallest fuss problem now, we are culmination into the future of others, causing even bigger problems. But quick fixing of the problem is neither quick or fixing anything. The secret of success is being the best in becoming better not better to become the best. Encourage yourself to keep learning, to keep trying and to keep succeeding. (do not Compare things). Nobody thanks the successful man by heart but by face and hate. Say to God! (Return to thee what he had taken in good heart, hate, punishment and rewards respectively. Forgiveness is not the best answer to the problem, but the best to forgiver. Say this always. “Lord! What is the best Answer”? “Answer is”. See with Two Eyes not with one eye, DO NOT COPY, and keep Succeeding.
Dr. Moyi Harry Ruben 211 922 442 554