Steve Keen: The International Financial Architecture 2


Naked Capitalism web site has the video Steve Keen: The International Financial Architecture. Naked Capitalism describes the video, thusly:

In this video, Steve Keen reviews the history of Keynes’ proposed international currency, Bancor, and why it failed to come to fruition at Bretton Woods. Keen thinks its time has finally come and supports the Central Bank of China’s call for its introduction.

As posted on YouTube by Steve Keen, it has the description:

My speech to the Meeting of Finance Ministers of Latin America in Quito on November 29th 2013. I explain Keynes’s proposal for an international unit of account called the Bancor, and support Zhou Xiaochuan, the Governor of the Central Bank of China, in calling for its introduction. I also argue that Latin America should in the meantime develop its own unit of account for intra-CELAC trade.


The speech even mentions some open source software called Minsky. That way, you can do your own economic modeling and predictions. The video also shows a link to Steve Keen’s Debtwatch blog.

On a superficial level, this presentation is fairly understandable. However, there is a depth to what is being said that requires deeper thought to fully understand.

I am afraid that my understanding of all of this does not live up to MardyS’s tongue in cheek claim that I am the smartest person in the room. It’s going to take quite a while for all of this to sink in and to reconcile with what I have been reading elsewhere. However, I bet that there other readers of this blog that will get it much faster than I will.

JoãoG should be happy with what Keen has to say about the Efficient Market Hypothesis.


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2 thoughts on “Steve Keen: The International Financial Architecture

  • SteveG Post author

    The Euro only only covers the Euro zone. If it were to become a reserve currency like the dollar, it would still be serving a dual purpose. What Keen is proposing is an international reserve currency that is only used for that purpose, and is specifically not used as the currency of any single nation or smaller groups of nations.

    The ability to create units of the reserve currency would not reside solely with a single country or subset of countries.

    Keen is for an interim step for Latin America – “I also argue that Latin America should in the meantime develop its own unit of account for intra-CELAC trade.” This currency would not be used for trade within any single country the way the Euro is used in Europe.

  • MardyS

    Glad you acknowledge there is something even in the economics realm that you are not the smartest person in the room about, Steve! Me? I’m way behind even you in grasping this but it sounds good for sure. Still, isn’t the Euro already there? I don’t know.