DESCRIPTION OF THE CURRENT OPERATIONAL SYSTEM: DISTINCTION RETWEEN NATIONAL AND INTERNATIONAL SYSTEMS

The current system distinguishes between the national system, usually headed by a central bank and using a national currency, and the international monetary system, which links most of them as a global layer. This distinction goes back, at least, to ancient Greece. Plato (The Republic and The Laws, describing his ideal city and political set-up) considers the domestic money used between free citizens and the international (foreign) currencies that the Republic will take care of by changing the coins, melting them or using them in international trade.[1] In The Republic, Plato recommended a “law that would forbid any individual to hold either gold or silver”.[2] It was a currency control system. Money, at that time, already had all the attributes of the money that we knew up to the 20th century. The new international monetary system is framed by the fact that national currencies are almost totally freely convertible – with the major exception of the Chinese currency. Nevertheless, we note that to have a statistical follow-up, regulation provides that effective payments between monetary zones are usually to be conducted either through the central bank or a bank delegated to centralize the currency international exchanges. We hereafter concentrate on the international system, not without a glimpse at the ongoing process of European integration and what the boundaries of a monetary zone are, as well as the boundaries (if any) between micro-surveillance and macro-surveillance, a coordination issue.

  • [1] The Laws, book V notes also Plato's concept: "From there the need for a market place and of a currency sign of value of exchanged goods" (French translation by Victor Cousin) and the distinction between merchants standing to exchange in the "Agora" (the central meeting place of the city) and traders who would travel to get the goods to be exchanged.
  • [2] The Laws, book II, paragraph XII.
 
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