Tackling Inflation Through Economic Reforms
Inflation occurs when the prices of goods and services increase over time. This means that you can buy less with the same amount of money than before. For example, if a pack of bread cost SRD30 last year and now costs SRD50 without your purchasing power being adjusted accordingly, then that is inflation.
Combating inflation requires fundamental economic reforms, if one looks at the micro- and macro-economic factors that sustain it. Economic reforms that go beyond just taking traditional monetary measures, because they have proven incapable of addressing the underlying structural problems of inflation and economic instability.
A bold but feasible step to tackle inflation and stimulate economic stability is the transition to a system without ‘money’ as we know it now, which to a certain extent requires a deep and radical paradigm shift. This with regard to how we define and conduct economic activities and transactions.
The transition to a cashless society may not be easy, but it is a necessary step to effectively address the structural problems of inflation and economic inequality and instability
This means that we must fundamentally rethink our economic systems and the role of money within them, and instead strive for a system based on direct exchange of resources that represent a certain economic value and harness the efficiencies of modern technology. The concept of a cashless economy, or even more strongly, a ‘cashless’ economy, may seem revolutionary, but it is essential to understand that it is merely a matter of redefining the rules that shape our current economic systems, and breaking open the conventions and/or treaties that support our current financial system.
Factors such as financial crises, financial sanctions imposed on sovereign countries, and trade wars between economic powers, can subtly initiate or accelerate the process of this change, as the restrictions expose the vulnerabilities of the current system. Through a collective exposure of the limitations and vulnerabilities, there is an opportunity to return to the financial source, where economic trade is based on assets of value rather than currencies.
This means that instead of relying on currencies and currencies for trade, economies can allocate and exchange resources directly based on economic value. For example, countries can enter into exclusive trade agreements and exchange oil for other natural resources or commodities, based on supply and demand, without the need for money as a ‘middleman’.
This concept is at the heart of a resource-based economy, where goods and services are available based on need rather than purchasing power. This shift is already visible on a small scale in countries that are facing severe financial sanctions, hyperinflation, or are trying to de-dollarize their economies.
The role of Blockchain technology can play a very important role in this matter, due to its many operational and logistical applications, such as the efficient storage, tracking and distribution of financial assets and movable and/or immovable property. For example, by tokenizing or converting natural resources or raw materials into digital assets, they can be managed, distributed and traded more easily and securely.
This process of digitization & tokenization of subjects and objects makes it possible to make property rights, voting rights and access to specific services digital and programmable. In this emerging new economy, tokens thus represent not only value, but also property and rights, opening the door to a completely new world order and way of economic and social interaction.
The transformation to a moneyless society thus depends entirely on simply redefining money itself. We need to expand the concept of tokenization to encompass both subjects (e.g., citizen registration) and objects (e.g., ballots). This change paves the way for programmable money, where digital tokens can fulfill various functions such as the aforementioned property rights and voting rights.
With the above approach, we can lay the foundation for a more robust and resilient economy. This means moving away from traditional currencies and toward a resource-based economy, supported by advanced technology.
This transformation, while challenging, offers a promising path toward sustainable economic reform and a future where value and need are the driving forces, not the fluctuations of monetary systems. In these challenging times of global financial crises, it is even more crucial that we think outside the box and are open to innovative solutions that can stabilize and strengthen our economy.
The transition to a cashless society may not be easy, but it is a necessary step to effectively address the structural problems of inflation and economic inequality and instability. It is an evolution that, if done well, will profoundly reshape our economic landscape and create a future where economic transactions and trade are based on fairness, efficiency and real value.
Source: De Ware Tijd Online 04/06/24
Author: Anthony Roy Sporkslede | Founder & CEO Mercury Iconex
Combating inflation requires fundamental economic reforms, if one looks at the micro- and macro-economic factors that sustain it. Economic reforms that go beyond just taking traditional monetary measures, because they have proven incapable of addressing the underlying structural problems of inflation and economic instability.
A bold but feasible step to tackle inflation and stimulate economic stability is the transition to a system without ‘money’ as we know it now, which to a certain extent requires a deep and radical paradigm shift. This with regard to how we define and conduct economic activities and transactions.
The transition to a cashless society may not be easy, but it is a necessary step to effectively address the structural problems of inflation and economic inequality and instability
This means that we must fundamentally rethink our economic systems and the role of money within them, and instead strive for a system based on direct exchange of resources that represent a certain economic value and harness the efficiencies of modern technology. The concept of a cashless economy, or even more strongly, a ‘cashless’ economy, may seem revolutionary, but it is essential to understand that it is merely a matter of redefining the rules that shape our current economic systems, and breaking open the conventions and/or treaties that support our current financial system.
Factors such as financial crises, financial sanctions imposed on sovereign countries, and trade wars between economic powers, can subtly initiate or accelerate the process of this change, as the restrictions expose the vulnerabilities of the current system. Through a collective exposure of the limitations and vulnerabilities, there is an opportunity to return to the financial source, where economic trade is based on assets of value rather than currencies.
This means that instead of relying on currencies and currencies for trade, economies can allocate and exchange resources directly based on economic value. For example, countries can enter into exclusive trade agreements and exchange oil for other natural resources or commodities, based on supply and demand, without the need for money as a ‘middleman’.
This concept is at the heart of a resource-based economy, where goods and services are available based on need rather than purchasing power. This shift is already visible on a small scale in countries that are facing severe financial sanctions, hyperinflation, or are trying to de-dollarize their economies.
The role of Blockchain technology can play a very important role in this matter, due to its many operational and logistical applications, such as the efficient storage, tracking and distribution of financial assets and movable and/or immovable property. For example, by tokenizing or converting natural resources or raw materials into digital assets, they can be managed, distributed and traded more easily and securely.
This process of digitization & tokenization of subjects and objects makes it possible to make property rights, voting rights and access to specific services digital and programmable. In this emerging new economy, tokens thus represent not only value, but also property and rights, opening the door to a completely new world order and way of economic and social interaction.
The transformation to a moneyless society thus depends entirely on simply redefining money itself. We need to expand the concept of tokenization to encompass both subjects (e.g., citizen registration) and objects (e.g., ballots). This change paves the way for programmable money, where digital tokens can fulfill various functions such as the aforementioned property rights and voting rights.
With the above approach, we can lay the foundation for a more robust and resilient economy. This means moving away from traditional currencies and toward a resource-based economy, supported by advanced technology.
This transformation, while challenging, offers a promising path toward sustainable economic reform and a future where value and need are the driving forces, not the fluctuations of monetary systems. In these challenging times of global financial crises, it is even more crucial that we think outside the box and are open to innovative solutions that can stabilize and strengthen our economy.
The transition to a cashless society may not be easy, but it is a necessary step to effectively address the structural problems of inflation and economic inequality and instability. It is an evolution that, if done well, will profoundly reshape our economic landscape and create a future where economic transactions and trade are based on fairness, efficiency and real value.
Source: De Ware Tijd Online 04/06/24
Author: Anthony Roy Sporkslede | Founder & CEO Mercury Iconex
Updated on: 14/12/2024
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