Towards an excellent monetary system – beyond inflation towards a freedom money system

Revolutions are sometimes important. We have had several revolutions of industry, science and digital technology in the last couple of decades. At current, digital tech and fintech are thought to be the biggest and most important recent revolutions of mankind. But currently no one, except me, understands that the biggest next revolutions are already on their ways. And that these next transformations will be the most massive and impressive revolutions ever in mankind. The first step of it is the transformation of the current monetary system towards the Excellent Monetary System created by me, Wilfred Berendsen. The next major step will be a transformation of sensemaking, sciences and practises based on and guided by also myself mostly…although that is something to be presented in the near future. After and with those massive transformations in our society, real sustainable transformations and real great transformations of sciences, politics and practises can occur and unfold.

Inflation is, in many ways, a phantom of the opera. With phantom I mean an illusion, a ghost. And with opera I mean the opera or story of our lives. Some parts of this opera, of our lives, are phantoms, and these phantoms are real in their consequences. All the phantoms of economists are. Especially as long as all these economists continue to believe in their phantoms and keep away from changing the insane fundaments of our society, our current monetary system, because of their religions based on partly their phantoms.

When economists talk about inflation, they often rely on theoretical misunderstandings about inflation and then they state that an increase in money in our economies would always lead to inflation. Added to that, they mostly view inflation as something utmost problematic and bad. While in reality, of course, there is a huge difference between problematic and non problematic inflation and also the results of this inflation will always be different and manifold. Just like the actions or inactions of preventing this inflation are always different and manifold. I am convinced that the manifold consequences of preventing inflation are many times worse, in many ways, than the actual occurrences of inflation will ever be or become in our current western societies.

This paper is an exploring paper about the current monetary system and the disadvantages and damages of this current monetary system for our economies and societies. After my views about this disadvantages and damages- which are debatable and extendable- I will continue by presenting my addition for the monetary system and the monetary policies that should guide it. This addition for the monetary system, but foremost also the monetary policies that are enabled then, mean a huge difference and improvement to the current monetary system, monetary and political policies, our economies and our society. It will mean the creation of the next global monetary system, one that is in many respects a lot better than the one we currently have

But, my monetary addition still needs to win a battle. Being the battle against the most persistent and damaging phantom of the opera of our lives. The phantoms of the opera are the illusions of inflation and economists.

Because of inflation, economists stick to the current monetary system and are not yet willing to change this system. Because of inflation, economists have been arguing that my monetary solution is a bad one. While in reality, it is not. In reality, my monetary solution will not lead to problematic inflation and also it will only improve the possibilities and freedoms of lower wage incomes. It will increase the possibilities of many individuals in our society and ensure a much stronger and healthier and sustainable society.

Around the years of 1930, John Maynard Keynes wrote his excellent “economic possibilities for our grandchildren”. I love this text because of the predictions stated in it. Also I love this text, because I am confident and sure that those predictions will become reality around the time predicted by John Maynard Keynes. Not because of him or because of economists, but because of me and my excellent monetary system. This system will become the new global monetary system for the whole world relatively soon. That is, as soon as the smarter economist of the central banks start using their brains and learn to think outside of the box and outside of their matrix of wrong economic misunderstandings

With the introduction of the latest monetary system, the beginning of the failures in our economies begun. This was because of the fact that although the linkages between money and gold where said farewell around 1971, the linkages between working and income and the linkages between income and taxes where still kept in pace/intact

Debts play an important part in our society, but currently they mostly play a highly problematic part in our society. A lot of this can, for instance, be read in the Policy Research Working Paper of the World Bank Group number 9116 with the title Debt and Financial Crisis by Wee Chian Koh et. Al.

This is largely, or solely, based on the wrong and insane logics of our current monetary system. This system only creates money when there are also debts involved. Which is insane because the creation of and existence of debts should not be based on the systematic process of a system, but based on logic. That logic is non existent in our current monetary system, because economist and mostly also central bank economists fail to understand the logic of debts. They fail to understand that there are logical and non logical debts. And what and when debts are logical, and when they are non logical

Debts are not logical, if those debts need to be taken on or when these debts are the consequence of people not being able to pay for a reasonable living. Debts are also non logical if persons or organizations need to pay for the debts of others. Because of this, it is not logical that all or most of governmental expenditures are paid by citizens of a country and organizations. Governments do not have other means of income now, but also that is not a real sound reason for solely being able to spend money for governmental expenditures if this expenditures are all paid by citizens of the country by means of work or non work and paying taxes. Taxes are mostly not really logical. It is far more logical if parts or even a lot bigger parts of the governmental expenditures are paid by government itself without tax incomes for these expenditures.

This is currently not possible as currently the monetary system and also the Maastricht treaty do not allow central banks to pay expenditures for governments. Which is really wrong and counterproductive and very damaging for our society and economy.

Governor Olli Rehn of the Bank of Finland spoke at the Warwick Economics Summit 2021. This summit was about “Cooperation between monetary and fiscal policies to mitigate the economic impacts of the Covid-19 pandemic”. Olli Rehn did argument that fiscal policies should match monetary policies. Also he spoke about inflation and a better insight in the driving forces of inflation, supported by fresh thinking.

I fully agree with olli rehn that fiscal policies should match monetary policies. But much more important than that, I understand that monetary policies of central banks should support political and governmental policies and our societies to the fullest and that this requires a much broader and better cooperation between central banks and governments than at current. Also, it requires a much more intelligent and sophisticated monetary system and monetary policies. We need much better monetary policies of governments that can and will prevent real problematic inflation and these monetary policies have to ensure a better and healthier and much more sustainable society.

Contrary to what Olli Rehn and Central bank economists and central banks believe, central banks can not really control and prevent problematic inflation as much as they think they can. Also, they even not fully understand what inflation is let alone what problematic inflation is and when it will or will not occur in our society. Understandings about this will improve a lot if they start understanding the huge differences between our current western society and the current characteristics of this society much better than they do now, and when they start to understand what these differences mean for the probability of problematic inflation to occur. In most cases, it will not become a real problematic issue anymore. Unless economists take non senseable and unwise monetary steps, like they did for many years at the beginning of this century. Those unwise monetary steps have led now to a rather huge and problematic inflationary result for the housing market. And it will become rather difficult to solve that easily. Especially if economists fail to transform the now insane fundament of our economies, our current monetary system, fast enough.

Trickle down economics does not work. The alternative of build up economics was proposed by Robert Reich some months ago, but also that will not work out to a solution. The best solution is Trickle up with my addition for the monetary system as a tool for increasing overall wealth and wellbeing for and in our societies.


- Is it not true that if lower incomes increase by means of a wage increase without this wage increase becoming a cost increase for the employers, that these employers have no direct reason to increase their sales prices?? Their incomes stay the same or might increase a bit. The lower incomes will mostly use their wage increases to pay for their debts or pay for education for themselves or their children. They may invest money. And yes, they partly may buy more products. This increases in demand will however be different than the increases in demand like they took place in countries and times where inflation became a real substantial problem for the economies.

My monetary solution could be termed as being a form of no reserve banking. The money being created through my monetary solution is debtless and created out of nothing. It is number money. This number money is just numbers but numbers within the current international banking system and networks. The money is allocated in much better and much wiser ways than it is with QE. My monetary solution is a real addition to the current monetary system, just like QE. The current monetary system and fractional reserve banking, the current monetary infrastructures and banks and even the creation and existence of debts stay into existence. But the possibilities of individuals and organizations within our economies and society will increase a lot.

My monetary innovation can be realized by central banks like for instance the Dutch Central Bank or the European Central bank within one day and without any high risks for our economies. It enables a much larger variety of possibilities, much more possibilities monetary and socially. I present part of these possibilities in my 2016 book in Dutch about my monetary solution, together with the monetary policies that are wise to realize by governments and companies through my monetary solution and the excellent monetary system.

Whenever I use the word monetary, I mean a lot more than the traditional or dominant meaning of monetary. With monetary, I not only mean banking monetary (the traditional and mostly dominant meaning of monetary, the field of monetary activities of banks) but also I mean with monetary the aspects of political and organisational and or societal monetary policies. For me, monetary policies are basically also most or all of the policies of governments and organizations that involve money. At current, there is a large divide between banking monetary and the other types of monetary that I mentioned. QE is mostly banking monetary, but should be much more also political and society and organisational monetary.

This broader definition of monetary but also the possibilities of my excellent monetary system require of central banks that they are not independent from governments, but on the contrary get much more involved with governments and politics and monetary policies of governments. This is also a lot more logical than the current situation, where banking monetary is solely a field of central banks and not even in line with the governmental and organizational monetary policies. A lot, really a lot, can be improved in our economies by matching the several monetary policies in our societies through communication and cooperation and enable much better monetary policies through a much more logical monetary system. This much more logical monetary system, leading to a much more logical and better society, is my excellent monetary system.

Because of the very different and far reaching monetary policies that I propose to guide and result from my EMS system, inflation processes but also about all the other processes and possibilities in our society will be very much different from the current ones. Inflation is now already incredibly low, so even if more money would lead to more inflation, it would not mean a huge problem if this increase is limited. Therefore, this is really the time to create more money at Central Bank level and then spend that money in best possible ways through governmental policies. These are the governmental monetary policies that I mention in my books about my monetary system and also in this paper.

If I was the board of the ECB, I would rush to create at least some billions of money for the EU and then communicate with the governments to spend this money firstly on sustainability and better health care. Or an increase in living wages for the lower incomes. When doing so, the definition and understanding of monetary policies and also the coordination between central banks and governments will transform immensely towards something much better than we have now…much more integrated and much more supportive to the citizens of Europe.

This sounds weird for many (central) bank economists at first probably. It is sounding non logical for economists mostly because central bank economists and economists in general have this weird, phantom misunderstandings about inflation. And also because they, like everyone, are used to be trapped into and oppressed by the current monetary system…a monetary system that disables the whole world to enjoy a freedom monetary system. Increasing the minimum wages or disposable incomes of lower income groups considerably is NOT possible within the current monetary system and with the current tight links between income, taxes and governmental expenditures! It is not, because the financial advantages of efficiency progress are not distributed towards the lower income groups in the ways it is expected by economists and many so called professionals and intellectuals. It is a fairy tail to believe that efficiency or any other scientific or human progress will ever lead to financial improvements for the lower income groups within and with the current insane financial system and monetary and financial structures! And it is a sure fact that Inequality will never ever be solved as long as this monetary system is NOT transformed into my excellent monetary system. There is a way needed to supplement the wages of the lower income groups without them having to pay relatively more taxes and without the employers of them having to pay higher incomes. That is not possible in whatever ways with the current economic, financial and monetary structures. The money game just HAS to be changed for that, and also the monetary system just has to be changed for it. When are central bankers and the leaders of the boards of central banks going to grasp this to the fullest?? When? I hope very soon…and I am very much available to get into discussions with them and explain them this all more extensively.

How to realize EMS banking
EMS banking is my addition for the monetary system. Together with my proposed monetary policies, this addition and the policies added to the current monetary system leads to the new global monetary system of the world that i called the Excellent Monetary System (EMS)

1) One or more servers big enough for EMS banking should be created and placed at a suitable organization. At least in the beginning, this will be central banks. Like for instance the DNB or ECB or in the united states the FED.
2) Professional ICT people able to install and maintain this EMS banking server system
3) Realisation of the EMS banking system on the EMS banking servers
4) This EMS banking system should be based on and made by the software that is now used for international banking at private banks like in the Netherlands for instance the ING or the ABNAmro banks. This banking software should be linked or stay linked with all the international banking systems at all banks, but has to be altered a bit. The accounts on the EMS banking system used for EMS banking, should be called EMS banking accounts. They are specifically meant for EMS banking. For enabling this, the number fields on EMS banking accounts (the number fields before the valuta signs) should be made adjustable. Meaning that the numbers there should easily be changed by authorized persons. Then in this fields, very large numbers can be typed in. By this, additional money is created basically out of nothing. Money without no debts against it. This EMS number money can then be used for payments because the EMS banking system is directly linked with the international banking systems and banking institutions and banks.

Difference with the current banking systems and monetary system
- EMS banking should at least in the beginning only be used for governments. The central banks create the money by means of the EMS method within the EMS banking system, and then this money is used for monetary political policies of governments that become enabled by means of this additional money. So this money should be used for specific aims by government and solely with cooperation between government and central banks. The central banks create and make available the EMS money.
- Later on, the EMS banking system can also be used for monetary policies and financial requirements of other specific organizations or individuals for specific or less specific aims. This although will probably require a good legal and organizational infrastructure proper for this aims.
- EMS banking does not create debts and no interest so no obligations to pay back. The money is created without reserves or debts and then it is allocated (spend) in right or wisest ways. This allocation or spending of EMS money has to be done right, according to the logics of the EMS policies in connection with the economy and society at large.

Monetary policies belonging to the EMS system

- Less linkages between labour/work and income, between income and taxes and between governmental expenditures and taxes. By means of multiple monetary policies enabling the situations where a smaller part of the total income is dependent on work, governmental expenditures can be paid even when there are no fiscal policies or taxes or just a lot less than now and therefore it also enables that taxes will not have to be paid or are paid less out of income and other activities in our society.
- Payment of all costs of healthcare and education by the governments. So no costs for healthcare or education for individual citizens. This alone already increases the disposable incomes of individuals and families considerably.
- Students will not have to pay for college or books or laptops withing the EMS system as these costs are paid from the EMS banking accounts. Therefore, their costs for education are a lot less than now and student debts will become non existent or very low compared to the present situation.
- When desired and wise, also every inhabitant of a country who is born in that country could get a gift from the government of a certain amount purely to be spend for housing. This could be first something like 20.000 euro’s to see what the results are in our economies, and then it could be repeated 2 to 4 times more if required. With same amounts of more or less. Something similar has already been proposed by Thomas Piketty in his book from 2019, but also I myself already proposed something similar but better in my book from 2016.
- Paying a big part of the governmental expenditures with EMS banking money. So not paying this expenditures through taxes with tax money, but instead paying the expenditures with money created on the EMS banking accounts following the EMS method. In that ways, the taxes can be decreased. Taxes on labor could then completely dissapear for wages lower than for instance 40.000 euros nett per year. Then this taxes can be added to the incomes of these workers completely. For instance. But there are enough other ways and possibilities there and then to increase the lower wages to above living wages. This is the most intelligent and best way to increase the wages of workers without increasing the costs for companies where those workers are employed. Therefore, these companies have no need to increase their prices while the incomes of this workers DO increase.
- Increasing the minimum wages or increasing alowances of the governments is not possible and not even always logical with the current monetary system. But with my EMS system is becomes not even logical but also perfectly possible. Because with my EMS system, wages can be increased by means of EMS number money without any additional costs for companies or society. Even rents can be paid by governments more than in the current situation where needed or required.

 Oppressed by money and our insane financial system- a wake up call for citizens, organizations, governments and society at large ( Drs. W.T.M. Berendsen, Lichtenvoorde, 2010-2011)
 De monetaire revolutie- Het Excellente monetaire systeem ( Drs. W.T.M. Berendsen, Lichtenvoorde, June 2016)
 Antenarrating our economy ( Drs. W.T.M. Berendsen, 2009)
 Debt and Financial crisis, world bank (Wee Chian Koh et. Al., 2020)