Introduction
Central URA was introduced to tackle significant challenges in the global financial system, particularly the accessibility and movement of capital and credit across national borders. Its issuance aligns with the goals outlined in the United Nations Convention on the Assignment of Receivables in International Trade, which seeks to “promote the availability of capital and credit at more affordable rates across national borders, thus facilitating the cross-border movement of goods and services.” However, in the process of issuing Central URA, the promoters identified the true cause of many economic challenges in the global economy: the debt-based fiat currency system. This led to the development of Central URA as part of a Credit-to-Credit Monetary System, offering a true alternative to both the limitations of the gold standard and the vulnerabilities of fiat currencies. This document explores the reasons behind the issuance of Central URA, emphasizing its role in advancing global economic stability.
The Need for Central URA
Global Financial Challenges
The global financial system has long faced issues related to the availability and cost of capital and credit. Traditional fiat currencies, which operate on a debt-to-credit basis, are prone to inflation, economic volatility, and the erosion of public trust. These issues hinder the smooth movement of capital and credit across borders, limiting global trade and economic growth.
- Inflation and Volatility: Fiat currencies are vulnerable to inflation, particularly when governments print more money to cover deficits, resulting in the devaluation of the currency and economic instability.
- Debt Accumulation: The debt-to-credit system often leads to unsustainable national debts, as governments borrow extensively, causing long-term harm to economic growth.
- Lack of Trust: Public confidence in fiat currencies can erode due to political and economic instability, leading to reduced spending, investment, and overall economic activity.
Promoting Cross-Border Capital and Credit
The United Nations Convention on the Assignment of Receivables in International Trade highlights the importance of improving access to affordable capital and credit across borders, which facilitates global trade and economic integration.
- Lower Costs: Affordable capital allows businesses to invest in growth and development, leading to job creation and economic expansion.
- Facilitating Trade: A stable, reliable currency reduces the risks and costs associated with international transactions, simplifying trade and eliminating the need for complex hedging strategies to protect against currency fluctuations.
- Economic Integration: Enhanced cross-border capital flows and trade promote greater global economic integration, contributing to a more resilient and interconnected global economy.
The Emergence of Central URA
RMI’s Quest for Liquidity
Central URA emerged serendipitously during Resource Mobilization Inc. (RMI)’s efforts to convert its vast receivables into liquidity. By 2014, RMI held significant receivables yielding 12.5% per annum, compounded daily. In the process of turning these receivables into liquid capital, Central URA was issued on November 14, 2014, marking a transformative development in asset-backed money.
- Asset-Backed Money: Unlike fiat currencies, Central URA operates on a credit-to-credit model, meaning its issuance is fully backed by tangible assets, ensuring that each unit of Central URA holds real economic value.
- Serendipitous Innovation: Initially, Central URA was not conceived as a comprehensive monetary solution. However, RMI’s process of converting receivables into liquid assets revealed Central URA’s potential as a stable, reliable form of money.
In developing Central URA, it became clear that the debt-based fiat currency system was at the root of many global economic issues. As an alternative, the Credit-to-Credit Monetary System, exemplified by Central URA, was created to address the limitations of both the gold standard and fiat currencies.
Asset-Backed Stability
Central URA’s asset-backed nature guarantees that each unit is tied to real, tangible assets. This ensures inherent stability and minimizes risks associated with inflation and currency devaluation, promoting confidence in its use for cross-border transactions.
- Reduced Inflation Risk: Since the issuance of Central URA is tied directly to assets, inflationary pressures are minimized, encouraging long-term investment and stable economic planning.
- Enhanced Trust: Central URA’s asset backing fosters trust among the public and investors. A currency backed by tangible assets is more likely to inspire confidence than one reliant solely on government backing.
- Reliable Medium of Exchange: The stability of Central URA enhances its reliability for both domestic and international transactions, facilitating smoother trade and investment flows.
Benefits of Central URA
Enhanced Financial Stability
Central URA’s asset-backed structure and credit-to-credit model address the volatility and instability often associated with fiat currencies. By ensuring that each unit of currency is backed by tangible assets, Central URA promotes greater financial stability, making it attractive for both national and international use.
- Long-Term Stability: Central URA’s asset backing reduces the risk of sudden currency devaluation, promoting long-term financial stability.
- Economic Resilience: A stable currency helps economies withstand external shocks such as financial crises or geopolitical events.
- Investment Attraction: Stability attracts both domestic and international investment, driving economic growth and development.
Facilitating Cross-Border Trade
A key objective of the United Nations Convention on the Assignment of Receivables is to ease the cross-border movement of goods and services. Central URA supports this by providing stable, reliable money for international trade, reducing risks and costs associated with currency exchange.
- Simplified Transactions: With a stable form of money, businesses can engage in international trade without worrying about currency fluctuations, reducing the need for costly hedging strategies.
- Increased Trade Volumes: Predictable, stable currency values encourage higher trade volumes, allowing businesses to plan and price products more effectively.
- Strengthened Trade Relations: Countries that adopt Central URA for trade can build stronger economic ties, as reduced currency risk fosters trust and cooperation.
Affordable Capital and Credit
Central URA enhances the availability and affordability of capital and credit, aligning with the Convention’s goals of promoting economic growth through accessible financial resources. With Central URA, businesses and governments can access credit at lower costs, supporting global economic development.
- Lower Borrowing Costs: The stability of Central URA leads to lower interest rates on loans, making borrowing more affordable for businesses and governments.
- Economic Growth: With access to affordable credit, businesses can invest in expansion, innovation, and job creation, driving economic growth.
- Infrastructure Development: Affordable capital can finance critical infrastructure projects, improving transportation, energy, and communication networks.
Central URA as a Reserve Money
Central URA’s stability and asset-backed nature make it an attractive option as reserve money. National governments can hold Central URA to strengthen their financial systems and enhance global economic stability.
- Global Confidence: Holding Central URA as reserve money boosts confidence in a nation’s economic stability, attracting foreign investment and trade partnerships.
- Reduced Dependency: By diversifying their reserves with Central URA, countries lessen their reliance on traditional fiat reserve currencies, mitigating risks associated with those systems.
- Enhanced Sovereignty: A stable reserve currency allows governments greater control over their monetary policies, reducing external pressures and economic volatility.
Conclusion
The issuance of Central URA was driven by the need to address critical challenges in the global financial system, particularly with regard to capital and credit availability across borders. In the process of developing Central URA, it became evident that the underlying issue was the debt-based fiat currency system. Central URA, grounded in the Credit-to-Credit Monetary System, emerged as a stable and reliable form of money, offering a viable alternative to both the gold standard and fiat currencies.
By aligning with the objectives of the United Nations Convention on the Assignment of Receivables in International Trade, Central URA promotes global financial stability, facilitates international trade, and ensures more accessible and affordable capital. As reserve money, Central URA further strengthens national economies by building confidence and enhancing financial resilience. Its role in fostering a stable, interconnected global economy positions Central URA as a crucial tool for advancing long-term prosperity and economic integration.