Tuesday, December 31, 2013

TPS - L’euro, moneta senza Stato


"PADOA-SCHIOPPA: Ma guardi, di moneta europea si e’ cominciato a parla alla fine degli anni 60 quando l’Europa era fatta di sei paesi e la Comunità’ Europea era fatta di sei paesi e la divisione dell’ Europa in blocchi sembrava un fatto destinato a durare chissà’ quanto tempo. Quindi in quel momento certamente non si aveva l’idea di trovarsi dove oggi ci troviamo con la Slovenia diventata uno stato indipendete uscita dal sistema delle economie socialiste, entrata nell’Unione Europa e molto rapidamente anche nell’Euro. Tutti questi sono sviluppi che quando si comincio’ a parlare di moneta unica europea nessuno immaginava..."

Audio (Italian): http://www.tommasopadoaschioppa.eu/wp-content/uploads/2009/10/20061229_18191.mp3

Source: http://www.tommasopadoaschioppa.eu/europa/leuro-moneta-senza-stato



PARIS, December 10-11, 2010
Venue: Pavillon Ledoyen, Paris

Source: www.tommasopadoaschioppa.eu/wp-content/uploads/2010/12/Agenda-Paris.pdf

TPS - 13th Annual International Conference Chicago, September 23-24-2010

"Research efforts and policy initiatives in the field of macroprudential regulation in my view are steps towards the correction of those flows. However, the construction of the viable and sustainable constitution of money consistent with a financial system which is highly sophisticated and with globalization requires probably further and more radical steps than the one that our goal today under the name of macroprudential regulation. This is a summary and I will develop my argument by first describing what I would call the old concept of central banking, then describe what I could name as the deconstruction of that concept. Third, I will briefly lead that through the crisis and finally say something about possible reconstruction.
So the elements of the old construct, the key elements are the following: First, central banks had a three-fold or triadic mandate which can be related to the three classic functions of money. They have a mandate in the field of price ability through the conduct of monetary policy and this can be related to the numeral function of money. They have paid a function in the field of financial stability, supervision of banks and these can be related to the store value of money, and they had a function in the payment system and this, of course, relates to the medium of the exchange function of money.
The essence of money is to perform these three functions which are inseparable and in my view equally inseparable where the three functions in the institution of central banks. A second element was the existence of an international anchor or a super-national anchor which put limits to the extent which money could be manipulated. That anchor was a commodity, it was gold; but conceptually, it could also be a different type of anchor. The essence is it was an international one that went beyond the sphere of exclusive influence of nation states.
The third element was the definition of the mandate of central banks in rather loose terms. If you read the statutes of the legislation of central banks prior to the wave of reforms of the last 30 years, the mandate of the central bank was tainted in very generic terms like looking after the currency, having some currency, safeguard the currency, notions like this. And the fourth element, the last was what I could call a single jurisdiction or monoline jurisdiction. I mean by this that in that old construct the debtor, the creditor, the intermediary, the currency, the legislation, the central bank all were belonging to the same, within the same perimeter of the nation state.
It took about a century for this construct to take shape. It began with the event of paper currency. It went on with the event of commercial bank money. It originates from the medium of exchange function of money with new ways to organize monetary exchanges. It developed into a banking supervision function, not on the basis of any specific mandate, but simply on the basis of a ‘know your client/know your customer’ type of need for the central bank, which was the bank operating with other banks and needed to know how sound their clients were..."

Source: http://www.tommasopadoaschioppa.eu/wp-content/uploads/2010/10/speech_TOMMASO-PADOA-1.pdf

TPS - Uneven global growth understandble

Interview by: Jamie McGeever

"JM: The Euro zone debt crisis reached a crescendo in May but already a second wave of market and economic uncertainty is upon us. Here to discuss the Euro zone policy and economic outlook is Tommaso Padoa-Schioppa, one of the founding fathers of the Euro and the European Central Bank. Mr. Padoa-Schioppa, thanks very much for joining us. Good day. There’s seems to be a sense within markets certainly that there’s a lack of policy coordination and cooperation on a global level. Do you agree with this?
TPS: To some extent, it’s true that now that the most acute phase of the crisis is over, countries tend to revert to their own policy agendas. In the meantime, the situation from country to country and from areas to areas is completely different and I think we are in a phase in which growth will be much less homogenously distributed across the world than it was before the crisis and I think rightly so.

JM: But how much of a risk does this pose to financial market stability and also to the recovery prospects?
TPS: Global recovery is underway but in an uneven way and I think this is understandable and justified. Emerging markets are growing faster, mature economies are growing more slowly and I think this is inevitable. Markets have to understand that but policies have to indicate clearly that they are able to manage global imbalances better than they did before the crisis.

Video interview: http://insider.thomsonreuters.com/link.html?ctype=group_channel&chid=3&cid=140981&shareToken=Mzo4NjE2ZmMyZC1mYThmLTQwMDAtYTEwYi00NmJmNmJiOTRiOGU%3D%0A

Source: http://www.tommasopadoaschioppa.eu/europa/uneven-global-growth-understandble-padoa-schioppa

Pre 1973 timeline - 1972

  • 1972 January 20: Six exporting countries - Abu Dhabi, Iran, Iraq, Kuwait, Qatar and Saudi Arabia - conclude ten days of meetings with Western oil companies. An agreement is reached to raise the posted price of crude by 8.49 percent to offset the loss in value of oil concessions attributable to the decline in value of the U.S. dollar. 
  • 1972 March 11: OPEC threatens "appropriate sanctions" against companies that "fail to comply with . . . any action taken by a Member Country in accordance with [OPEC] decisions." 
  • 1972 May 10: 229. Volcker Group Paper  
  • 1972 June 1: Iraq nationalizes Iraq Petroleum Company's (IPC) concession owned by British Petroleum, Royal Dutch-Shell, Compagnie Francaise des Petroles, Mobil and Standard Oil of New Jersey (now Exxon). The concessions were valued at over one billion dollars. 
  • 1972 June 9: In a show of support for Iraq, OPEC moves to prevent companies whose interests were nationalized in Iraq from increasing production elsewhere; appoints mediators between Iraq and IPC. 
  • 1972 July 31: 239. Paper Prepared in the Department of the Treasury
  • 1972 September 30: Libya acquires a 50 percent interest in two ENI concessions. 
  • 1972 October 27: OPEC approves plan providing for 25 percent government ownership of all Western oil interests operating within Kuwait, Qatar, Abu Dhabi and Saudi Arabia beginning on January 1, 1973, and rising to 51 percent by January 1, 1983. (Iraq declines to agree.) Agreements signed on December 21.

Pre 1973 timeline - 1971

  • 1971 Since the agreements of 1971 and 1973, OPEC oil is exclusively quoted in US dollars. This created a permanent demand for dollars on the international exchange markets.
  • 1971 January 12: Negotiations begin in Teheran between 6 Persian Gulf oil producing countries and 22 oil companies.
  • 1971 February 3: OPEC mandates "total embargo" against any company that rejects the 55 percent tax rate.
  • 1971 February 14: Tehran agreement signed. Companies accept 55 percent tax rate, immediate increase in posted prices, and further successive increases. 
  • 1971 February 24: Algeria nationalizes 51 percent of French oil concessions.
    March 1971, four months before Nixon closed the Gold window, the "permanent" U.S. debt ceiling had been frozen at $US 400 Billion.  
  • 1971 April 2: Libya concludes five weeks of negotiations with Western oil companies inTripoli on behalf of itself, Saudi Arabia, Algeria and Iraq. Agreement raises posted prices of oil delivered to Mediterranean from $2.55 to $3.45 per barrel; provides for a 2.5 percent annual price increase plus inflation allowance; raises tax rate from a range of 50-58 percent to 60 percent of posted price. 
  • July 31: Venezuela's Hydrocarbons Reversion Law mandates gradual transfer to government ownership of all "unexploited concession areas" by 1974 and "all their residual assets" by 1983. 
  • 1971 May 9:  153. Paper Prepared in the Department of the Treasury
  • August 15: U.S. Government institutes Phase I price controls. Invoking the powers granted to the president by the Economic Stabilization Act of 1970, President Richard Nixon orders 90-day nationwide freeze on all wages, prices, salaries and rents. President Richard Nixon unilaterally suspended the convertibility of dollars into gold, effectively ending the gold standard. The United States then entered negotiations with its industrialized allies to appreciate their own currencies, in response to this change.
  • 1971 August 17: 171. Memorandum of Conversation
  • 1971 September 22: OPEC directs members to negotiate price increases to offset the devaluation of the U.S. dollar. 
  • 1971 November: U.S. Phase II price controls begin. Plan is to allow for gradual 2-3 percent annual price increases, however, domestic petroleum prices remain at Phase I levels. 
  • 1971 November 27: 209. Information Memorandum From the President's Assistant for International Economic Affairs (Peterson) to President Nixon
  • 1971 December 5: Libya nationalizes British Petroleum concession. 
  • 1971 Nixon Shock, when the US unilaterally suspended the direct convertibility of the United States dollar to gold and made the transition to a fiat currency system. The last currency to be divorced from gold was the Swiss Franc in 2000.  
  • 1971 December: The Smithsonian Agreement  that ended the fixed exchange rates established at the Bretton Woods Conference of 1944. The Group of Ten agreed to appreciate their currencies against the United States dollar. 
  • 1971 December 31: 212. Editorial Note

A trial - Pre 1973 timeline

US Gov docs + WIKILeaks + Timeline (oil/gold/politics):

Thursday, December 12, 2013

2013 LBMA Precious Metals Conference - 3 files

Present Role of Gold as Part of the Foreign Reserves of the Deutsche Bundesbank
Clemens Werner
Deputy Head of the Market Operations Division, Deutsche Bundesbank
Rome, 30 September, 2013

Source: www.lbma.org.uk/assets/Werner%2020130930.pdf

Alternative page: http://www.lbma.org.uk/pages/printerFriendly.cfm?thisURL=index.cfm&page_id=159

Managing Gold as a Central Bank
Alexandre Gautier
Director of Market Operations Department, Banque de France 
Rome, 30 September, 2013

Source: www.lbma.org.uk/assets/Gautier%2020130930.pdf

Central Banks and Gold – A New ChallengeJuan Ignacio Basco
Deputy General Manager, Central Bank of Argentina

Rome, 30 September, 2013

Source: www.lbma.org.uk/assets/Basco%2020130930.pdf

Main source page: http://www.lbma.org.uk/pages/index.cfm?page_id=159&title=programme

H/T Woland