Cicero: "Freedom is participation in power."

As long as Venezuela's oil holds out and there are valuable mineral resources in some of those 9 countries that can be traded globally they can engage in this. But at some point they will be compelled to move to other more stable currencies being pushed by the BRIC nations: Brazil, Russia, India & China.

Well said, ezeflyer!

And let me just say that I think we will see more of this in the near future. Goodbye worth-paper-and-ink-only "Greenbacks!"

Also, this should start gold soaring at at even faster rate than it has the last two weeks BUT I recently found out that the gold market is ALSO controlled by certain organizations so it will NEVER reach its true value. (Estimated to be--now--at about $2,000+ per ounce...minimum!!!

But from among the three of China, Russia, and the US, from the historical record and particularly its actions over the past few decades, I would think the US is the last one to trust with the world's fate.

I am not surprised.

I often told friends of mine for at least five years now - that "one day , perhaps sooner than people think, REGIONAL ALLIANCES as a result of US imperialistic arrogance..WILL find a way to RUN AROUND the Dollar dominance" .

one of the first times i remember arguing like that with friends who had more "economics" backgrounds was when George Bush invaded Iraq - and I told them that the now accelerating OVERT wars that the USA is pushing is going to seriously affect the general US economy that in the end the Dollar VALUE will suffer and the USA will be seen as UNDEPENDABLE ...with the dollar having NOTHING to back it UP ..not real assets EQUAL to its CLAIMS as "dominant and valuable" ...not PRODUCTIVITY despite the american claims of "efficiency", nor even the ability to pay MERELY the USA's debts on their INTEREST alone..and the result will be :

"what ALWAYS LOOKED like too much of a good thing...INDEED was too much of a good thing" and THAT's the Dollar hegemony.

and that no matter how the US federal bank FLOODS the world with US currency -- other countries will simply decide that they've HAD ENOUGH of their holdings of US debt and other businesses and investments and EVEN HOLDING THEIR SOVEREIGN WEALTH HOSTAGE to the dollar and AWAY from their DOMESTIC developments , so much so that they'd be willing to have a RUN on the dollar temporarily and LOSE some value on their dollar holdings RATHER than continue to make their currencies and economies SERVICE the US Dollar

with the USA's UNEARNED and UNJUSTIFIED rigging of the global finance system to advantage the US empire - at the backs of OTHER economies.

now -- it's coming around, gradually, by fits and starts for sure........but that's eventually going to be the "new normal" that the USA simply will have NOTHING to do against , much as it tries to invade left and right to try and put a stop to the bleeding of ITS Dollar Hegemony which is

fundamentally

the HEART and SOUL of its EMPIRE!

it's ovah.

Why SHOULD it be "freely floated?" the "Free floating" of currencies is itself based on the Hegemony of the DOllar - in order to KEEP foreign currencies structurally WEAK while allowing the USA - which is itself "unfreely" floated but pegged to ITSELF ONLY (while forcing other economies to "float" and peg TO the Dollar which GAVE the dollar its unearned "stability" as monopoly "world currency").

CHINA did NOT "freely float" its currency during the 1990s or SINCE - against US demands - and THAT allowed china to weather already at least THREE great recessions and bubble bursts INITIATED or CAUSED by the USA economic system of "suppressed wages globally" and Finance Industry legerdemain of "Phantom wealth"....

where when one looks behind the curtain -- there's really NOTHING there of real value.

most people accuse china of "manipulating" the yuan by "artificially keeping it low while pegged to the dollar" when in fact

it is the USA that is MAIN currency manipulator :

manipulating not ONLY ITS own "value" through "overnight interest rates" declared by the Federal bank (now down t0 ZERO) - between banks - to keep FLOATING the banks at the REAL economies' expense (such as in low wages, higher "productivity" demands per worker at LOWER wage value, while forcing most productive human beings JOBLESS and thus a LOSS of REAL wealth and earning and consuming power) -

but manipulating other currencies THROUGH its artificially, rigged, "dependability" as the world's main trade currency....

EVEN IF that SAME "dependability" is based - for many decades now - even BEFORE nixon - on US military impositions that force other economies to keep THEIR currencies' "floated" so long as they are WEAK compared to the dollar - to KEEP their wages and resources CHEAP for the USA to RAPE them at will.

THAT"s the real system that has been going about.

it is the system that has kEpt other economies from USING THEIR SOVEREIGN WEALTH POWER ISSUANCE of CREDIT - to develop their internal economies and THEREFORE NOT BECOME DEPENDENT

on USING their own sovereign credit creation (for fear of inflating) and savings to BUY US DOLLAR CURRENCY

MERELY to make trade transactions among themselves.

REMOVE that DOLLAR INTRUSION between regional countries - and they are FREED more - pending their own having good enlightened leaderships who DO use their sovereign power to print THEIR DOMESTIC CREDIT to enhance their economies -

to use that same sovereign credit to issue to their people the "money" to afford high wages, full employment, and not WASTE that CREDIT by translating it outwards as national currency that has to be accumulated or printed to BUY US "savings" or "bonds" or -- voila - the GREAT WONDERFUL US DEBT

MERELY to have what?

A PIECE OF PAPER called the US DOLLAR to make THEIR transactions among themselves?

i mean -- that's so OBVIOUS.

it's PURE BLACKMAIL by the USA upon the rest of the world when it became possible for the USA to replace the British Sterling after world war 2 when most economies were either devastated and no global system of proper transaction was evolved..and THAT"S where the USA jumped in like a Predator.

what is happening in regions is simply that they are picking up where the world LEFT OFF - or SHOULD HAVE been many decades ago :

NOT PERMIT the USA to IMPOSE its will - by sheer backroom deals and pen and paper and INK

to CLAIM:

"THE USA is the most dependable economy in the world - and by the POWER of the US GOVERNMENT to COVER expense or credit or trust -- the world should use the US dollar as transaction money"

which entrapped what were THEN weaker, as yet unfully developed modern economies after 2 world wars and other regional crises (not least many of them ALSO instigated or worsened by US intrusions) - INTO a RIGGED SYSTEM of US Dollar Hegemony

and which forced the rest of the world

to practically SUPPORT the USA economy and put the US "prosperity" (claimed as PURELY american inqenuity or "hardwork") --

ON WELFARE!

the rest of the world, having gained SOME independence, while the USA is BUSY trying to PLUG the holes breaking through its dollar hegemony (EX: IRAQ, SADDAM HUSSEIN trying to move to EURO, IRAN same thing) but showing its IMPOTENCE through its VIOLENCE .....

the rest of the world is simply doing what it OUGHT to have been doing since LONG AGO!

simply DECIDE - with their SOVEREIGN power to do so - without INSTRUCTIONS from the USA -

on how and which currency to use as transaction symbol between themselves.

PERIOD!

it's not THAT complicated.

it's as simple as CUTTING THROUGH THE MIDDLEMAN.

and the USA has been the MIDDLEMAN of global transactions that ATE UP the majority of the earnings BETWEEN the parties who should NEVER have allowed the "middleman" to call the shots to begin with!

I disagree. I believe the most important question is will the sucre be backed by a basket of commodities and metals (precious and others) to keep the currency stable and make it extremely difficult to manipulate or undermine. If it is not a fiat currency and the backing isn't limited to a manipulable set of commodities, it will work. Otherwise, the USA will be able to trash it.

If you look further you'll find that the Sucre was the national currency of Ecuador before it was hyperinflated out of existence. http://en.wikipedia.org/wiki/Ecuadorian_sucre

There's a certain irony to the use of the term "Sucre" for the newly proposed regional currency.

I'm encouraged by the fact that Ecuadorian President Rafael Correa has been trained as an economist and seems to know the dismal science quite well. http://en.wikipedia.org/wiki/Rafael_Correa

Hopefully he will have a moderating influence on the rather more unschooled exuberance for humanist/leftist solutions as espoused by Chavez and Morales. In particular, the recent spate of nationalizations of industries is undoubtedly justified inasmuch as private owners have tended to profiteer at the expense of local populations, but the moral hazard is that the newly nationalized industries are going to be under immense pressure from a new class of exploitative bureaucrats leaving the people in essentially no better position than they started out in.

The instances where this has occurred are legion in the history of nationalizations. The Credit Lyonnaise scandal in France is a developed economy example. In China today, amazing injustices are being carried out by Communist Party regional bosses expropriating communal properties for private gain. Part of the reason the Soviet system never fulfilled truly socialist goals was the mendacity of the apparatchiks who were perfectly willing to substitute themselves for the Czar's aristocracy as the corrupt masters of Russia.

There's a lot of risk in what Chavez, Morales and Correa are attempting via ALBA. Hopefully they have learned some of history's lessons.

Whatever difficulties may befall the new currency are not likely to be worse than continued servitude in a $y$tem designed for their failure.

==============

I agree. particularly that point made which i quoted.

it is servitude to the usa dollar that has been going on.

the other currencies will not be able to match that kind of dominance anytime soon in this world, especially with the regimes of currencies they know they have to agree with having seen what a "dominant" or hegemonic currency has done, particularly if promoted by a country , none other than the usa , that has had every intention of using that hegemony for its global empire.

other countries now know, they have the experience of having been empires themselves or under - that that kind thing simply won't do in this world anymore. they themselves - in their regional alliances, even if out of convenience - are proof of it and they know that and become their own "moderators"...so that even if one particular country becomes "big" (china)

it is far too tied TO the prosperity or welfare of its regional allies - and the cross-regional relationships to ever want to "go it alone" in the hubristic way that the USA has done - while also trying to be the Planet's Lord and master.

it -- just -- won't -- work. there are too many "forces" outside of even a very powerful country's abilities to forever maintain or "contain".

Brazil is already involved in barter agreements with Russia, India and China (replacing dollar quoted commodities). These agreements on commodities are knocking the stuffing out of the dollar as we speak.

agreed, but we all know why that won't happen.

interesting, do you have any links to support this?

i'd be interested into looking at alternative economic models as well as what brazil, and other countries have been up to.