Gamesmith94134: A Rule of Law for Sovereign Debt

In deciding the law for sovereign debt, we must have a political platform as infrastructure in defining the status of debt. Perhaps, I would look into the United Nations Security Council to branch out settling the global financial matter as in currency war and debts war too. It would be convenient for the FED to takeover AIG to profit 23 billion after the settlement of its bankruptcy that many may see the Fed as the vulture fund in disguise after the Lehman Brothers case in Hong Kong. The current Greece settlement, it allows IMF to veto the subsidies for the senior pensioners over its defense cut in forwarding the loans to Greece.

Perhaps, these behavior are much intrusive than a president’s veto. It is just simply pen-it-off or white-out the debtors’ offer. I sensed the causation was the rise of Syriza that democratic lenders are paranoia if the loan rolls over will give socialists to control; it is the same case for Mr. Maduro, it progresses in Venezuela. I agree with Mr. Joseph E. Stiglitz and Mr. Martin Guzman that Sovereign debt can’t be “contractual” and no voluntary renunciation of sovereign immunity, just as no person can sell himself into slavery. So, legally, “pari Passu” may not botched out by judges hired by lenders to decide the case, I think we must establish what sovereign is other than contract; and those hedge fund manager may not need all his money to buy out a sovereign to build his pyramid in a hurry if the international settlement can restore sovereignty that it recognizes the limits that debtor nation’s citizen would not be sold to slavery or corrupted officials cannot sell or buy sovereignty over profit. I think United Nations Security Council would be the best alternative on the input of oversight and transparency to all global financial settlements that it will judge both lender and debtor at the same level. Perhaps, 193 nations can deliver best then G7, even G20; since the demographic changed, and no sovereign can be dragged by their nostrils for their free trade and fair trade environment.

In order to establish the sovereignty rights and controls to the regional development or investment, I suggest the zones by recognizing the North America, South America, Africa Union, ASEAN, OCED for EU, and Eurasia Union to hold parties in monitoring the developments and investments under the umbrella of World Bank, IMF, and WTO to supervise the progression what bonds can be traded as sovereign bonds which currency may not be a factor to a trade war.

In addition, we must establish the long-term investment plan and FDIC for all continental transfer; and 1% charge on the continental transfer to cut “crash flashes” in the stock and equity market; and ½% for the sovereign fund to invest in the lower rate return. So, each sovereign benefit from its entitled funding from the short-term investment that come and go in 40 days. Such saving will be kept in their reserves or collateral for loans administrated by the zones or trade groups. For much of 2% to return may make investment sustain a longer life to the region to void “beggar thy Neighbor” or eliminate money laundry. Perhaps, each Zone will have its investment Bank to sell sovereign bond to its partners as in sovereign funds who participate and register.

Eventually, with these reserves charged from the trans-continental transfer, the World Bank and Regional investment bank can guarantee these sovereign bonds. WTO can monitor how these bonds are traded and exchanged with less influence of the hedge fund manager or nations; finally IMF can harness all funds exchanged among sovereigns. BY then, through the cooperation of these establishments we can stop those manipulate the currencies or even attempt to collapse other economy.

If we can define what sovereign bond, then the other local bond paid in tax credits can be processed through the commercial banks or financial for much collateral of equity it can bear; so, everyone would be conscientious to the risk he can take or he can sell the tax credit to corporations who need them. Perhaps, By then, we can break the cycle of irrational exuberance, or even diminish the dream by those think of manipulate interest rate, or exchange rate that eventually harm the sovereigns.

Based on my experience on security, I think these changes are essential to the present mainframe as in infrastructure in changing the present global financial system; and expansion of the bonds classes that can be done in separating sovereign and local, even in SOE. It is because the current one did not promote democracy or transparency, it just muddled with no respects of sovereignty and humanity.

During the current recession, it is a good time to globalize the financial system once and for all. G7 or G20 may depend on its own components to dissolve their problems by using the corporate sovereign; and its isolation or containment plan can make the status quo worsen.

May the Buddha bless you?

