August 5, 2014 JC Collins 5 Comments
Decentralization Leads to More Centralization
By JC Collins
The financial world was centralized around a unipolar American dollar since 1944 and is now going through a form of temporary decentralization with the implementation of the eastern led BRICS Development Bank and Contingent Reserve Arrangement.
The unipolar dollar world was sustained primarily by institutions which at first appeared to be American controlled but upon further investigation and logical realization were found to be controlled by the same international banking interests which were behind the BRICS institutions.
These western institutions are the Federal Reserve, the World Bank, World Trade Organization, and the International Monetary Fund. The BRICS Development Bank and Contingent Reserve Arrangement can be added to these institutions as economic tools of the same international banking interests.
The decentralization is only temporary as the BRICS countries continue to anticipate a restructuring of the International Monetary Fund as agreed upon by all G20 countries back in 2010. The delays in implementing these reforms continues to carry increased costs for the world economy but also increases the leverage being applied on the dollar system. This leverage will ultimately lead to a further centralization as the system makes the inevitable transition to the multilateral SDR based system.
The history of empires and reserve currencies follow each other closely and always end in periods of economic and geopolitical decentralization. These periods are fraught with instability and ideological border repositioning. Yet, for all the opportunities which these periods hold for the disorganized masses to take control of the mechanisms of the larger socioeconomic world, each period once again takes on the form of a new and deeper centralization which remains in the control of the small organized elite, as represented by the international banking interests.
The reason for this is likely to involve the manufacturing of the decentralization process by the same interests which plan to implement a broader centralization further down the road. The masses are focused on controlled news sources and engineered events which steer the illusion. The machinations of economic and geopolitical control are to be kept out of the hands of the disorganized masses at all costs.
All men who learn of such things as socioeconomics are naturally inclined to seek an ever upward movement through the social structure. This inclination is somewhat tribal in nature and is better explained in the world of anthropology as opposed to the world of economics. Though both disciplines are built strongly upon the observations of man in his natural state.
It is this natural state of man and how he interacts within a tribal structure which ensures a constant and steady flow of human interest into the lower ranks of the small organized elite. In essence, the centralization and decentralization processes are tribal in design and function.
A form of decentralization which is in fact another centralization is the Chiang Mai Initiative Multilateralization. This is a currency swap arrangement between the ASEAN countries, being Brunei, Cambodia, Hong Kong, Indonesia, Japan, Laos, Malaysia, Myanmar, the People`s Republic of China, Philippines, Singapore, South Korea, Thailand, and Vietnam.
The CMIM’s capital is drawn from a foreign exchange reserve pool amounting to $240 billion US.
The recent creation of the BRICS Contingent Reserve Arrangement, along with the Chiang Mai Initiative, partially make up a larger group of regional financial arrangements which include:
Arab Monetary Fund
European Stability Mechanism
Fondo Latinoamericano de Reservas
North American Framework Agreement
South Asian Association for Regional Cooperation
All of these arrangements appear to be a decentralization away from the dollar centralized system. And yet all of them are serving the larger macro process of consolidating sovereign currencies into regional groupings which can be further centralized once again under a supra-sovereign multilateral currency system.
This site has often written of the regional currency groupings which will inevitably be implemented as a part of the broader SDR system. Now information is beginning to come forth supporting a Middle Eastern Union being pushed by the small organized elite. We discussed this here before and suggested that a regional dinar currency would likely take shape to support the larger socioeconomic structure which is yet to emerge. The Arab Monetary Fund will play an important role in any regional arrangements.
It’s important to acknowledge that all of the regional financial arrangements listed above are governed by the respective central banks of member countries. And as we know, all central banks are governed by the Bank for International Settlements, which is the visible representation of the international banking interests.
So here we have a perfect example of what appears to be a mass decentralization born from the end of the unipolar dollar based system, which is in fact a further centralization under a new and emerging multilateral system.
This multilateral system will be represented as the SDR supra-sovereign reserve system, a further and broader centralization then we have ever seen before, as confirmed by the level of regional financial arrangements which are governed by central banks. – JC