While the distraction that is the stock market continues to enthrall most Americans, the big shots in the global monetary which for now are taking place behind the scenes, are getting ever louder.
One person who is paying attention to the failure of the US to grasp that the unipolar world of the 1980s is long gone, is Russia’s Vladimir Putin, who earlier today proposed creating a “Eurasian” currency union which would have Belarus and Kazakhstan as its first members, which already are Russia’s partners in a political and economic union made up of former Soviet republics.
As Telegraph reports, Putin made his proposal at a meeting with the Belarussian and Kazakh presidents which highlighted the challenges facing the Russian-led Eurasian Economic Union following the fall in global oil prices and the decline of the Russian rouble.
“The time has come to start thinking about forming a currency union,” Mr Putin said after the talks in the Kazakh capital Astana with Belarussian President Alexander Lukashenko and Kazakh President Nursultan Nazarbayev.
Not surprising, considering both Belarus and Kazakhstan have spent a lot of time in the past year alternatively devaluing, and scrambling to prop up their currency.
Putin gave no details of the proposal but suggested it would be easier to meet economic challenges by working closely together. Mr Lukashenko and Mr Nazarbayev did not immediately respond to the proposal in public, but analysts say it is unlikely to get off the ground.
Additional information from RT:
“I would suggest moving step by step, exactly as all EU member states enter the eurozone, gradually creating all these common financial institutions,” Likhachev said, adding that if such an order comes from the member leaders, all the sides will immediately start negotiations.
“That means any slightest fluctuation in national currencies of today’s four and of tomorrow’s five [Kyrgyzstan is about to join the EEU – Ed.] EEU countries, that are related neither to trade nor to demand, create a huge trade imbalance,” he said, adding that officials are looking for ways to smooth these problems out, and trade and industry institutions are in a constant dialogue.
“In the same enclosed space, where goods, services, capital and labor are constantly moving, the existence of different currencies exacerbates the risks,” Likhachev said. Apart from the economy, there are also political and social issues that are yet to be discussed, he added.
If and when Russia does succeed in launching a regional currency, and recreating a monetary block in the process setting the foundations, the only question we have is after Greece, which European country will come knocking on the Kremlin’s door, asking to be let in?