It did not take long for long time gold advocate Steve Forbes to offer up his reaction to the Facebook Project Libra news. He pens this open letter to Mark Zuckerberg appearing in Forbes magazine. Below I have pasted in the introduction to his open letter. Mr. Forbes says the Libra should be backed by gold and also suggests a potential name change for the currency.

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Dear Mr. Zuckerberg:

"Your company made big headlines when it announced it would be launching a cryptocurrency called the Libra in 2020. Not surprisingly, given the nature of the times, the project has been greeted with intense criticism and skepticism. Don’t lose heart. In one sense, the idea of a company creating its own kind of money is an old one. The airlines’ frequent-flier miles are really a form of money that customers can earn and use to buy trips and various other things. Credit card companies, hotels and numerous retailers have all sorts of loyalty programs in which people earn points that will let them buy all manner of goodies.

But if you play your cards right with the Libra, you could be to money and finance what Henry Ford was to automobiles. Your new currency could take its place alongside the inventions of coins and paper money many centuries ago. It could replace the U.S. dollar as the global currency.

. . . .

Here are crucial tips to turn the Libra into one of history’s truly seminal creations:

Make it as good as gold. Backing your new money—as you plan to do—with a basket of currencies won’t cut it. In today’s monetary system the values of currencies jump up and down, so you won’t get the stability you need.

Countries that became global powerhouses–Holland, followed by Britain (Isaac Newton, as director of the Royal Mint, fixed the pound to gold at a ratio that held for more than two centuries) and then the U.S. (thanks to Alexander Hamilton)—all had their currencies linked to gold."    . . . . click here to read the full open letter

from Steve

to Mark

see the open letter here

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My added comments: In some ways this whole topic of potential monetary system change has been difficult to cover because I mostly have had to report that not much that could initiate major change has been happening lately. 

But suddenly, with the global release of Facebook's Project Libra proposal, there is a huge uptick in interest if for no other reason than the enormous footprint Facebook has globally with its user base.

Now we have a leading gold advocate joining in the reaction parade writing the open letter linked above. Ironically, later this year Kinesis is expected to launch its own fully physically backed gold and silver currencies that will operate on a blockchain. They just put out this interesting news release. Kinesis is already attempting to do what Steve Forbes is calling on Mark Zuckerberg to do with the Libra. Kinesis says in this news release that they will partner with the Post Office in Indonesia to offer their gold and silver backed currencies across the region.

"In accordance with the new regulation, Kinesis, OZL and the Indonesian Government Postal Service (PT POS) are planning to develop, build and operate an international standard vaulting facility in Jakarta.

Additional stakeholders in the project include, Jakarta Futures Exchange (JFX), government clearinghouse Kliring Berjangka Indonesia (KBI) and religious organisation – Nahdlatul Ulama (NU) who have 100+ million members."

. . . .

"POS Indonesia have indicated they will facilitate and contribute significant resources and support for the project, including the contribution of land; licenses for Free Zone/Bonded Warehouse designation, and duty-free imports; permits for expedited building, construction and utilities; as well as significant post-launch marketing and logistical support."  excerpted from news release

So maybe we are starting to see some fireworks (no 4th of July pun intended) flare up related to this whole topic of monetary system reform. It's way too early to know if any of this will significantly impact the present monetary system. On the other hand, we can't just ignore a tech giant company with over 1 billion users jumping into the arena, Steve Forbes writing open letters about it, and people like Kinesis partnering up with state organizations like the Indonesian Post Office. It's news we do need to cover and follow over time.

As always, we will monitor events and report what actually happens with these various proposals as they attempt to launch and gain broad public adoption.