NEW – July 6, 2022
To begin with, let me remind you: in April, the Secretary of the Security Council N. Patrushev proposed the following:
“For the sovereignisation of any national financial system, its means of payment must have intrinsic value and price stability, without being tied to the dollar… The ruble must be provided with both gold and a group of goods that are currency values.”
In order not to get ahead of myself, I decided to wait for specifics and now it finally began to leak: “The authorities are discussing the provision of the ruble with the national wealth of Russia.” But more on that later, but for now I’ll remind you of something else.
I am far from thinking of myself as being smarter than others, but almost 10 years ago I already thought about how to arrange it so that the Russian ruble could be turned into the strongest world currency, independent of either cut green paper or other regional surrogates, such as the euro, provided only with information-psychological pumping and blind faith in the void, in nothing. As a result , I came to the conclusion:
“… the times of secured money must come. The question is one thing: what will the future money be provided with? Gold and other precious materials? Perhaps, for the size of the modern economy, even taking into account its artificial bloat and virtuality, this provision will be, to put it mildly, not enough, if not negligible. Nevertheless, I insist that the provision should be material and tangible. And such provision should be the most valuable material wealth in the modern economy: from hydrocarbons (both extracted and explored) and metals, to basic products intended for consumption, as well as acreage potentially intended for the production of marketable food. A specific list and methodology for calculating the basic cost of collateral is a job for competent experts, the result of which should be a voluminous report on the basis of which the country’s top leadership will promote the new system at the international level. The purpose of this proposal is to restore banal justice – the largest country with almost half of the world’s mineral reserves, by definition, should have the hardest currency. I believe that for Russia, this goal should become a priority strategic goal in the field of finance.”
Subsequently, I turned to this topic several times, not really counting on the result. A vague hope that something was in motion appeared from the moment when the president set a condition for the “unfriendly”: gas for rubles, but there was an understanding that this was only the beginning of a long process, which, perhaps, is the cornerstone in changing the development paradigm, as well as the most controversial and risky, but without which talks about the sovereignty of Russia are meaningless.
And now, finally, information has come that the Russian government has been closely, and not for the first year, dealing with exactly the issue that I consider to be the main one at the moment, surpassing in importance everything that has happened in the past and, perhaps, will be in the future, and where the Ukrainian events are just an episode with already a well-known and understandable result.
From an interview with the director of the Institute of Economic Policy Problems of the Financial University under the Government Sergey Silvestrov about the “commodity ruble”:
“… the question arises, at the expense of which goods it is possible to expand the provision of currencies. There is a proposal to expand at the expense of goods that represent not only consumer value, but also currency value. This means that such goods are always in demand and can be exchanged for other goods.…
As a result, the Russian ruble and monetisation will not be provided at the expense of the supply-demand balance relative to reserve currencies. And not gold, but a wide range of commodity and currency values produced by domestic producers.”
For reference: Russia possesses about 40% of the world’s most valuable minerals. In the EAEU – 60%, and the BRICS countries are already 80% of the world’s wealth. Thus, in view of the development in BRICS of a provision on an internal unit of account based on a basket of currencies (in the EAEU, this is already the Russian ruble) included in this association, all unsecured currencies will be quickly thrown to the sidelines of civilisation, and exchange rates based on them will lose all meaning (in fact, they are already losing, just they don’t know about it yet). In particular, countries with emission centres of the dollar and the euro will also have to think about providing their currencies with similar positions, which seems very difficult, since almost nothing remains for their share of the world’s wealth. And if we also take into account the exorbitant debt load, under which they can simply pump everything for free (hypothetically, of course), then there is no subject for conversation.
Nevertheless, I believe that everything will not go as smoothly as it is written on paper, moreover, I believe that such a strategy, firstly, puts an end to the Western development paradigm, and secondly, is fraught with the most fierce opposition, up to a real military clash. This is both a risk and a chance at the same time, because it is here that Koshchei’s needle is located, which has already been found and should definitely be broken. So, the theatre of military operations of Russia and the West is already looking for a completely different suitable platform, with different coordinates and dimensions for the “last and decisive”.
P.S.
On the one hand, I am surprised that the topic, which I consider the most important, has not received proper development in the blogosphere, on the other hand, there is doubt that it is so necessary to give it publicity from high tribunes. Money loves silence, especially those that can be a deadly surprise for Koshchei.
Aleksandr Dubrovsky
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