Call for a New Bretton Woods System in Copenhagen Daily
COPENHAGEN, Nov. 5, 2007 (EIRNS) An article in Copenhagen's daily Berlingske Tidende calls for New Bretton Woods system in midst of Danish election campaign. Referring to the currency, the krone, the headline reads "The Krone Is Out in Stormy Weather with the New Currency Crisis," by the daily's correspondent Ole Bang Nielsen. The kicker asks "Are there any boundries for how far the dollar can continue to fall before we have the biggest currency crisis since the Bretton Woods system fell apart in the beginning of the 1970s on our hands?"
Near the end, he writes, "The logical solution would, of course, be that the major economic actors on the world scene sat down and made an agreement about regulating their currency rates, which would be advantageous for the whole world economy." This was done in the 1980s with Japan. It would be hard now to do the same with China. "So, to make the story short, the world needs a new international monetary system to replace the Bretton Woods system, which collapsed 35 years ago. But that will probably not happen until after a new American President is elected, and maybe a situation where the dollar begins to go over the edge into free fall."
In the beginning, he writes that while everyone is speculating about the various party combinations after the elections on Nov. 13, sometimes it's healthy to look at the world outside Denmark. And it doesn't look good. "The next Danish government will very quickly have to deal with the biggest international currency crisis in decades, which could endanger the last 25 years of Danish fixed-rate-currency policy for the krone." (Although is outside of the eurozone, it is pegged to the euro.) People didn't think that oil would go over $50 a barrel, and now it's over $90. The U.S. Fed lowering the interest rates hasn't dampened the turmoil, and the stock market fell on Friday, Nov. 2. They're trying to keep the bubble aloft, because they can't push austerity during an election campaign.
He concludes that because the krone is not part of the eurozone, it will be interesting to see what happens, because the eurozone countries would try to protect themselves and maybe not support the krone.
Well, Tom Gillesberg, and the other three independent candidates from the Schiller Institute are bringing precisely these questions into the election.