Serbia ranked 95th on "economic freedom" list

Good to see Macedonia highest in Balkans. Albania did grew too 54th, beating France, Italy, Malta, Portugal, Slovenia, Croatia, Slovakia, Turkey, Serbia, Montenegro, Greece, Bulgaria, Romania, BiH (just the European ones). Greece is stuck below poverty, whilst Serbia has been placed in the 3rd world block...

But poor old Ukraine is oppressed lol...

"Instead of this Serbia could simply tell the central bank to create 10 billion Dinars and it would not have to pay interest to foreigners. "
(Michael Thomas, 15 January 2014 09:40)

Yes, printing billions of Dinars. And then trillions, and fantastillions, and in the end, you'll have a currency reform creating a 'new dinar' worth some billon of 'old' dinars. Sounds familiar? January 1994, anyone?

printing US dollars: US can do it because the USD is the biggest global reserve currency. Even so, it's not without consequence. USD has tumbled in strength in the last decades

Printing Yuan: The Chinese Yuan is not a freely-traded currency, so they can fix the exchange rate. Chinese can get away with this without collapsing because they are a huge exporting economy with a massive population.

Neither of these situations is the case with the Serbian Dinar.

You propose to make Serbia an island. First problem with this is you think that Serbs would like this. Take away their ability to get the latest iphone and you'll have 10000x more people in the streets than any Kosovo protest could draw.

The Government must do everything in its power to stabilize the external debt. This Government is not blame for this debt, and I think that it will do anything to improve our economic situation. Serbia has achieved its highest economic freedom score ever. Despite significant progress in a few areas, however, it continues to lag in promoting the effective rule of law. Implementation of deeper institutional reform remains critical for all us.

The Government must do everything in its power to stabilize the external debt. This Government is not blame for this debt, and I think that it will do anything to improve our economic situation. (Tarapana, 14 January 2014 17:50)

Of course the government is responsible for the external debt. The Serbian government borrows Euros and Dollars to pay pensions and salaries in Serbia. This is an absurd situation. Serbia borrows, say 100 million Euros from a German bank at 10% interest. It deposits this money in the Serbian central bank and can only then issue 10 billion Dinars. Under EU/IMF/BIS rules Serbia needs “assets” before it can issue new currency. It is paying foreign bankers interest so that it can print Dinars. Instead of this Serbia could simply tell the central bank to create 10 billion Dinars and it would not have to pay interest to foreigners. Where do you think the German bank found the original 100 million Euros? They created them out of thin air. This is what the West call “quantitative easing” and it has allowed America, Britain, Germany, Japan, China and other independent countries to create trillions of Dollars, Euros, Pounds, Yen, and Yuan to help their economies. Serbia should do the same.

How does one get the latest iPhone with Dinars that can't be traded for another currency?
(Danilo, 16 January 2014 14:29)

The way currencies are traded today is wrong and corrupt. Currencies are moved up and down at will by crooks like Soros and Goldman Sachs. It would be better to have a currency fixed in value against a basket of goods.

So to answer your question, the Dinar would have a value based on the value of a basket of goods, not the whim of a politician, or the manipulations of speculators. Serbia does have a natural flow for foreign currency (Diaspora, international trade) which can be bought for Dinars at the official “basket” rate. No fraud or theft is involved. This foreign currency would be used by importers to bring in iPones.
(Michael Thomas, 16 January 2014 16:29)

Sure, Venezuela, for example, has an official “basket” rate... and guess what. There is nobody willing to sell foreign currency at that rate so foreign currency has to be bought at the (black) market rate. Dear, what you are saying is nice in theory, but at the end of the day, the will of the market prevails. You would never sell 1 EUR for 40 RSD, if you believe it is worth 120 RSD, no matter what the Serbian government says. Call it wrong, corrupt or whatever, but that's how it is - you care about yourself, first and foremost, not about Serbia.

Michael Thomas, 15 January 2014 09:40
Such a simplistic view, reminds me of when my children were small and they would ask for something and we would say that is too expensive, we do not have enough money and they would say "write a check"
The country that actually attempted your economic philosophy that comes to mind was Zimbabwe, and the end result was they had to print billion dollar bills because ordinary items such as bread would cost millions.
Your idea would work if Serbia did not have to trade with other nations but since it does anytime it prints money without assets to offset its value then the dinar just devalues.
If it were as easy as you seem to think the US would simply pay off its debt tomorrow.

Serbia can thank the war and bombing that took place in the 90s for this rankings.

Serbia can thank the war and bombing that took place in the 90s for this rankings.
(nemanja prutajic, 16 January 2014 07:50)


In a way, you're right. The bombing strengthened Serbia's criminal class in politics and made it difficult to ask questions for fear off being decared "unpatriotic".

Other than that, no, it's no one else's fault that Serbia is in a mess. Remeber, the report isn't talking about how rich Serbia is or isn't. They're talking about the economic system Serbia has.

but, it wouldn't work that way. It didn't work that way in the Soviet Union. They set their official rates in the way you propose, but the black market rate was 2-3x higher, because more people wanted jeans, pantyhose and bubblegum than was officially allowed.

This creates a black market for foreign currency.

If you really think that Serbs would like to live in this kind of economic isolation, I think you are mistaken.

You're just another guy not living in Serbia that has lofty ideas about how other people should live based on theories that wouldn't affect you.

The basket of goods valuation means that purchasing power is maintained between currencies.
(Michael Thomas, 17 January 2014 10:00)

Yep, if the value of the basket of goods is determined by the market, not by decree of the Serbian government.

But if the value of the basket of goods is determined by the market, you are at the same point you are today :)

If bankrupt western banks can lend (create money) based on non-existent assets, then why can the Serbian Central Bank lend (create money) based on the hundreds of billions of assets the state owns and based on the future tax revenues it can extract from the Serbian people?
(Michael Thomas, 17 January 2014 12:05)

The Serbian Central Bank does that already as do Serbian Commercial banks. The same happens already in all countries of the world that have a banking system; be those countries Western, Eastern, Southern or Northen. I'm not really sure what you are trying to say... I think you need to put your thoughts in order and think about the causality of things and how you go from A to B to C...

Yes, printing billions of Dinars. And then trillions, and fantastillions, and in the end, you'll have a currency reform creating a 'new dinar' worth some billon of 'old' dinars. Sounds familiar? January 1994, anyone?
(Comm. Parrisson, 15 January 2014 14:20)

Ever heard of massive economic sanctions against the FRY?

Ever heard of massive economic sanctions against the FRY?
(The Other Half, 15 January 2014 21:34)

yes, this was the reason for massive printing. what's your point?

So, Michael.

How does one get the latest iPhone with Dinars that can't be traded for another currency?

Surely you can see how ridiculous it is to have a theory that works only if the whole world decides to adopt that theory, can't you?

I'm glad you're finally honest about this point. That your printing dinars theory that you're obsessed with can't be done just like that without the whole world deciding to act differently.

Sorry, Michael. The whole world isn't going to change overnight just because you think you have a better idea.

Danilo

I appear to have confused you. I apologise for that. The State Theory of Money does not require the world to adopt it. Any country can adopt it independently; in fact many already have. China uses money creation for the benefit of China, it doesn’t allow foreign private bankers access into its market. I know that some foreign inestment banks have moved it, but they are mostly involved in investment and not normal bank lending.

All foreign banks operating in Serbia are technically bankrupt, they have no assets. Their assets are worth less than their liabilities, and this is one of the definitions of bankrupt.

These banks are allowed to keep phony assets on their balance sheets against which they can lend 10-times more. This lending is money creation. They are lending money that they don’t have and that didn’t exist until the loans were made.

If bankrupt western banks can lend (create money) based on non-existent assets, then why can the Serbian Central Bank lend (create money) based on the hundreds of billions of assets the state owns and based on the future tax revenues it can extract from the Serbian people?

now we're going in circles.

It's already been explained to that, when this has been done, you get a black market for foreign currency.

Your explaination for the way out was "well, the whole world will just adopt my system"

Do you admit/recognize that your system would mean that imports cost 5-10x more? Or is everyone just going to hold hands, sing kumba-ya, and cooperate nicely to make sure that it doesn't?

“The country that actually attempted your economic philosophy that comes to mind was Zimbabwe“
(a New Day, 16 January 2014 02:36)

Actually pretty well every country in the world does things the way I describe except for one important difference, they all allow private bankers to act as ’middle-men’.

Here is how things work in Serbia today. The European Central Bank (ECB) lends Deutsche Bank (DB) 1 billion Euros at 0% interest. The ECB magicked this money ’out of thin air.’ Deutsche Bank keeps this money in its account and calls it an ’asset.’ Because it now has an ’asset’ it can lend 10-times the value of this ’asset’ to borrowers. DB can now create 10 billion Euros in loans. DB lends 'Deutsche Bank Serbia' (a separate bank) 1 billion Euros at 0% interest. DB-Serbia now has 1 billion Euros in ’assets’ and can lend Serbian borrowers 10-times that sum (10 billion Euros) or 1 trillion Dinars. DB-Serbia can, and does, create Dinars this way every day and charges the Serbian government and people 10%-30% interest for doing this. Based on nothing more than ’thin air’ 1,000,000,000,000 Dinars have been created by private bankers who want to be paid interest for their ’work.’ If private banks can do this, then why not the Serbian Central Bank? The only difference is that when the Serbian Central Bank does it, this money can lent to the Serbian government at 0% interest.

All I am asking for is that we cut out the 'miidle-men.'

yes, this was the reason for massive printing. what's your point?
(Danilo, 16 January 2014 00:55)

It is an important fact that CP forgot to mention. It is relevant.

How does one get the latest iPhone with Dinars that can't be traded for another currency?
(Danilo, 16 January 2014 14:29)

The way currencies are traded today is wrong and corrupt. Currencies are moved up and down at will by crooks like Soros and Goldman Sachs. It would be better to have a currency fixed in value against a basket of goods.

For the purpose of illustration let us imagine a simple basket: kilo of bread, litre of beer, litre of petrol, and a kilo of potatoes.

In London this basket costs £6. In Belgrade it costs 600 Dinars. Therefore the exchange rate is £1 = 100 Din. If there is inflation in Serbia (say 100%) and no inflation in the UK, then the exchange rate automatically changes. This basket still costs £6 in London, but is 1200 Din in Belgrade. The new exchange rate is £1 = 200 Din.

The purpose of an exchange rate should be to guarantee that you can buy equivalent goods in another country. In the first example a Serb with 600 Din could swap them for British pounds and buy the same basket of goods in london as he can in Belgrade.

So to answer your question, the Dinar would have a value based on the value of a basket of goods, not the whim of a politician, or the manipulations of speculators. Serbia does have a natural flow for foreign currency (Diaspora, international trade) which can be bought for Dinars at the official “basket” rate. No fraud or theft is involved. This foreign currency would be used by importers to bring in iPones.

You would never sell 1 EUR for 40 RSD, if you believe it is worth 120 RSD, no matter what the Serbian government says.
(icj1, 16 January 2014 19:06)

The basket of goods valuation means that purchasing power is maintained between currencies.

If I spend £100 on my weekly food shopping, then I should be able to swap £100 and buy enough Dinars to buy the equivalent shopping in Serbia. The official exchange rate will be computed daily for a range of currencies and that will satisfy everyone. I have travelled to Serbia on several occasions and the fluctuating artifical exchange rates have meant that my British pounds have sometimes allowed me to live like a God and sometimes like a pauper. I remember once feeding a group of 8 friends (food and drink) at a good Belgrade restaurant for £10.

If someone in Serbia has 1000 Din, which is enough to buy a decent meal in a Belgrade restaurant, then my ’basket of goods’ exchange rate system will mean that these Dinars can be swapped into enough British pounds or Euros for this Serb to buy a meal anywhere in Europe.

You're just another guy not living in Serbia that has lofty ideas about how other people should live based on theories that wouldn't affect you.
(Danilo, 16 January 2014 20:03)

The theory I am discussing is call the State Theory of Money is something that all states of the world should adopt. It puts the issuance of money and credit back where it belongs, in the public domain. These ideas would work in Britain just as well as in Serbia, but since London is at the centre of the bankster money-printing racket I think it unlikely that Britain will be the first nation to nationalise its banking system.

The Government must do everything in its power to stabilize the external debt. This Government is not blame for this debt, and I think that it will do anything to improve our economic situation. (Tarapana, 14 January 2014 17:50)

Of course the government is responsible for the external debt. The Serbian government borrows Euros and Dollars to pay pensions and salaries in Serbia. This is an absurd situation. Serbia borrows, say 100 million Euros from a German bank at 10% interest. It deposits this money in the Serbian central bank and can only then issue 10 billion Dinars. Under EU/IMF/BIS rules Serbia needs “assets” before it can issue new currency. It is paying foreign bankers interest so that it can print Dinars. Instead of this Serbia could simply tell the central bank to create 10 billion Dinars and it would not have to pay interest to foreigners. Where do you think the German bank found the original 100 million Euros? They created them out of thin air. This is what the West call “quantitative easing” and it has allowed America, Britain, Germany, Japan, China and other independent countries to create trillions of Dollars, Euros, Pounds, Yen, and Yuan to help their economies. Serbia should do the same.

The Government must do everything in its power to stabilize the external debt. This Government is not blame for this debt, and I think that it will do anything to improve our economic situation. Serbia has achieved its highest economic freedom score ever. Despite significant progress in a few areas, however, it continues to lag in promoting the effective rule of law. Implementation of deeper institutional reform remains critical for all us.

printing US dollars: US can do it because the USD is the biggest global reserve currency. Even so, it's not without consequence. USD has tumbled in strength in the last decades

Printing Yuan: The Chinese Yuan is not a freely-traded currency, so they can fix the exchange rate. Chinese can get away with this without collapsing because they are a huge exporting economy with a massive population.

Neither of these situations is the case with the Serbian Dinar.

You propose to make Serbia an island. First problem with this is you think that Serbs would like this. Take away their ability to get the latest iphone and you'll have 10000x more people in the streets than any Kosovo protest could draw.

Good to see Macedonia highest in Balkans. Albania did grew too 54th, beating France, Italy, Malta, Portugal, Slovenia, Croatia, Slovakia, Turkey, Serbia, Montenegro, Greece, Bulgaria, Romania, BiH (just the European ones). Greece is stuck below poverty, whilst Serbia has been placed in the 3rd world block...

But poor old Ukraine is oppressed lol...

"Instead of this Serbia could simply tell the central bank to create 10 billion Dinars and it would not have to pay interest to foreigners. "
(Michael Thomas, 15 January 2014 09:40)

Yes, printing billions of Dinars. And then trillions, and fantastillions, and in the end, you'll have a currency reform creating a 'new dinar' worth some billon of 'old' dinars. Sounds familiar? January 1994, anyone?

Serbia can thank the war and bombing that took place in the 90s for this rankings.

How does one get the latest iPhone with Dinars that can't be traded for another currency?
(Danilo, 16 January 2014 14:29)

The way currencies are traded today is wrong and corrupt. Currencies are moved up and down at will by crooks like Soros and Goldman Sachs. It would be better to have a currency fixed in value against a basket of goods.

For the purpose of illustration let us imagine a simple basket: kilo of bread, litre of beer, litre of petrol, and a kilo of potatoes.

In London this basket costs £6. In Belgrade it costs 600 Dinars. Therefore the exchange rate is £1 = 100 Din. If there is inflation in Serbia (say 100%) and no inflation in the UK, then the exchange rate automatically changes. This basket still costs £6 in London, but is 1200 Din in Belgrade. The new exchange rate is £1 = 200 Din.

The purpose of an exchange rate should be to guarantee that you can buy equivalent goods in another country. In the first example a Serb with 600 Din could swap them for British pounds and buy the same basket of goods in london as he can in Belgrade.

So to answer your question, the Dinar would have a value based on the value of a basket of goods, not the whim of a politician, or the manipulations of speculators. Serbia does have a natural flow for foreign currency (Diaspora, international trade) which can be bought for Dinars at the official “basket” rate. No fraud or theft is involved. This foreign currency would be used by importers to bring in iPones.

You would never sell 1 EUR for 40 RSD, if you believe it is worth 120 RSD, no matter what the Serbian government says.
(icj1, 16 January 2014 19:06)

The basket of goods valuation means that purchasing power is maintained between currencies.

If I spend £100 on my weekly food shopping, then I should be able to swap £100 and buy enough Dinars to buy the equivalent shopping in Serbia. The official exchange rate will be computed daily for a range of currencies and that will satisfy everyone. I have travelled to Serbia on several occasions and the fluctuating artifical exchange rates have meant that my British pounds have sometimes allowed me to live like a God and sometimes like a pauper. I remember once feeding a group of 8 friends (food and drink) at a good Belgrade restaurant for £10.

If someone in Serbia has 1000 Din, which is enough to buy a decent meal in a Belgrade restaurant, then my ’basket of goods’ exchange rate system will mean that these Dinars can be swapped into enough British pounds or Euros for this Serb to buy a meal anywhere in Europe.

Danilo

I appear to have confused you. I apologise for that. The State Theory of Money does not require the world to adopt it. Any country can adopt it independently; in fact many already have. China uses money creation for the benefit of China, it doesn’t allow foreign private bankers access into its market. I know that some foreign inestment banks have moved it, but they are mostly involved in investment and not normal bank lending.

All foreign banks operating in Serbia are technically bankrupt, they have no assets. Their assets are worth less than their liabilities, and this is one of the definitions of bankrupt.

These banks are allowed to keep phony assets on their balance sheets against which they can lend 10-times more. This lending is money creation. They are lending money that they don’t have and that didn’t exist until the loans were made.

If bankrupt western banks can lend (create money) based on non-existent assets, then why can the Serbian Central Bank lend (create money) based on the hundreds of billions of assets the state owns and based on the future tax revenues it can extract from the Serbian people?

Yes, printing billions of Dinars. And then trillions, and fantastillions, and in the end, you'll have a currency reform creating a 'new dinar' worth some billon of 'old' dinars. Sounds familiar? January 1994, anyone?
(Comm. Parrisson, 15 January 2014 14:20)

Ever heard of massive economic sanctions against the FRY?

Ever heard of massive economic sanctions against the FRY?
(The Other Half, 15 January 2014 21:34)

yes, this was the reason for massive printing. what's your point?

Michael Thomas, 15 January 2014 09:40
Such a simplistic view, reminds me of when my children were small and they would ask for something and we would say that is too expensive, we do not have enough money and they would say "write a check"
The country that actually attempted your economic philosophy that comes to mind was Zimbabwe, and the end result was they had to print billion dollar bills because ordinary items such as bread would cost millions.
Your idea would work if Serbia did not have to trade with other nations but since it does anytime it prints money without assets to offset its value then the dinar just devalues.
If it were as easy as you seem to think the US would simply pay off its debt tomorrow.

Serbia can thank the war and bombing that took place in the 90s for this rankings.
(nemanja prutajic, 16 January 2014 07:50)


In a way, you're right. The bombing strengthened Serbia's criminal class in politics and made it difficult to ask questions for fear off being decared "unpatriotic".

Other than that, no, it's no one else's fault that Serbia is in a mess. Remeber, the report isn't talking about how rich Serbia is or isn't. They're talking about the economic system Serbia has.

“The country that actually attempted your economic philosophy that comes to mind was Zimbabwe“
(a New Day, 16 January 2014 02:36)

Actually pretty well every country in the world does things the way I describe except for one important difference, they all allow private bankers to act as ’middle-men’.

Here is how things work in Serbia today. The European Central Bank (ECB) lends Deutsche Bank (DB) 1 billion Euros at 0% interest. The ECB magicked this money ’out of thin air.’ Deutsche Bank keeps this money in its account and calls it an ’asset.’ Because it now has an ’asset’ it can lend 10-times the value of this ’asset’ to borrowers. DB can now create 10 billion Euros in loans. DB lends 'Deutsche Bank Serbia' (a separate bank) 1 billion Euros at 0% interest. DB-Serbia now has 1 billion Euros in ’assets’ and can lend Serbian borrowers 10-times that sum (10 billion Euros) or 1 trillion Dinars. DB-Serbia can, and does, create Dinars this way every day and charges the Serbian government and people 10%-30% interest for doing this. Based on nothing more than ’thin air’ 1,000,000,000,000 Dinars have been created by private bankers who want to be paid interest for their ’work.’ If private banks can do this, then why not the Serbian Central Bank? The only difference is that when the Serbian Central Bank does it, this money can lent to the Serbian government at 0% interest.

All I am asking for is that we cut out the 'miidle-men.'

yes, this was the reason for massive printing. what's your point?
(Danilo, 16 January 2014 00:55)

It is an important fact that CP forgot to mention. It is relevant.

You're just another guy not living in Serbia that has lofty ideas about how other people should live based on theories that wouldn't affect you.
(Danilo, 16 January 2014 20:03)

The theory I am discussing is call the State Theory of Money is something that all states of the world should adopt. It puts the issuance of money and credit back where it belongs, in the public domain. These ideas would work in Britain just as well as in Serbia, but since London is at the centre of the bankster money-printing racket I think it unlikely that Britain will be the first nation to nationalise its banking system.

So, Michael.

How does one get the latest iPhone with Dinars that can't be traded for another currency?

How does one get the latest iPhone with Dinars that can't be traded for another currency?
(Danilo, 16 January 2014 14:29)

The way currencies are traded today is wrong and corrupt. Currencies are moved up and down at will by crooks like Soros and Goldman Sachs. It would be better to have a currency fixed in value against a basket of goods.

So to answer your question, the Dinar would have a value based on the value of a basket of goods, not the whim of a politician, or the manipulations of speculators. Serbia does have a natural flow for foreign currency (Diaspora, international trade) which can be bought for Dinars at the official “basket” rate. No fraud or theft is involved. This foreign currency would be used by importers to bring in iPones.
(Michael Thomas, 16 January 2014 16:29)

Sure, Venezuela, for example, has an official “basket” rate... and guess what. There is nobody willing to sell foreign currency at that rate so foreign currency has to be bought at the (black) market rate. Dear, what you are saying is nice in theory, but at the end of the day, the will of the market prevails. You would never sell 1 EUR for 40 RSD, if you believe it is worth 120 RSD, no matter what the Serbian government says. Call it wrong, corrupt or whatever, but that's how it is - you care about yourself, first and foremost, not about Serbia.

but, it wouldn't work that way. It didn't work that way in the Soviet Union. They set their official rates in the way you propose, but the black market rate was 2-3x higher, because more people wanted jeans, pantyhose and bubblegum than was officially allowed.

This creates a black market for foreign currency.

If you really think that Serbs would like to live in this kind of economic isolation, I think you are mistaken.

You're just another guy not living in Serbia that has lofty ideas about how other people should live based on theories that wouldn't affect you.

Surely you can see how ridiculous it is to have a theory that works only if the whole world decides to adopt that theory, can't you?

I'm glad you're finally honest about this point. That your printing dinars theory that you're obsessed with can't be done just like that without the whole world deciding to act differently.

Sorry, Michael. The whole world isn't going to change overnight just because you think you have a better idea.

now we're going in circles.

It's already been explained to that, when this has been done, you get a black market for foreign currency.

Your explaination for the way out was "well, the whole world will just adopt my system"

Do you admit/recognize that your system would mean that imports cost 5-10x more? Or is everyone just going to hold hands, sing kumba-ya, and cooperate nicely to make sure that it doesn't?

The basket of goods valuation means that purchasing power is maintained between currencies.
(Michael Thomas, 17 January 2014 10:00)

Yep, if the value of the basket of goods is determined by the market, not by decree of the Serbian government.

But if the value of the basket of goods is determined by the market, you are at the same point you are today :)

If bankrupt western banks can lend (create money) based on non-existent assets, then why can the Serbian Central Bank lend (create money) based on the hundreds of billions of assets the state owns and based on the future tax revenues it can extract from the Serbian people?
(Michael Thomas, 17 January 2014 12:05)

The Serbian Central Bank does that already as do Serbian Commercial banks. The same happens already in all countries of the world that have a banking system; be those countries Western, Eastern, Southern or Northen. I'm not really sure what you are trying to say... I think you need to put your thoughts in order and think about the causality of things and how you go from A to B to C...