In a shocking statement, the Governor of the Bank of England, Mark Carney, has said that the world needs a ‘Libra-like currency’ to act as the world’s reserve store of value.
Speaking at the U.S. Federal Reserve’s annual symposium, BoE Governor Mark Carney made his case for why global commerce needs to change. It’s the current currency and trade wars, he argues, which has forced us to reconsider the dollar’s supremacy. What’s needed now is new ideas and, namely, a virtual currency of the world not tied to any particular nation-state.
The crisis, he says, demands such a solution. As the Governor of the Bank of England told he audience:
“The combination of heightened economic policy uncertainty, outright protectionism and concerns that further negative shocks could not be adequately offset because of limited policy space is exacerbating the disinflationary bias in the global economy.”
Carney was one of the few central bankers who seemed open to the Libra’s promise. Ultimately, he believed the concept to be sound, but was unsure if Facebook could be trusted. Now, he is taking this a step further by outright making the case for a global virtual currency. He believes that such a solution would help out the entire world, considering that an overly-strong dollar does not benefit the United States much.
As of now, the Libra seems unlikely to be approved and meet its 2020 deadline. It has faced persistent criticisms from lawmakers, regulators, and central banks across the board. Still, Facebook seems unlikely to let the idea go anytime soon.
Do you believe a global virtual reserve currency would benefit global commerce? Let us know your thoughts in the comments below.
Image courtesy of The Telegraph.