Global Debt Realignment

The Debt Realignment Initiative

For a global problem we need a global solution.

“The significant problems we face cannot be solved at the same level of thinking we were at when we created them.”

Albert Einstein

History

The World Debt can only be an estimate.

If you look at different sources, you get different numbers. It depends on what is being counted and how.

Nevertheless, it is accepted that the total world debt is above 49 trillion dollars.

49 trillion dollars! and growing.....

Conceptually, we must realize what a trillion is. This is part of the problem. We do not understand the numbers.

This may help:

Rounded off: A million seconds is 11.5 days. A billion seconds is 32 years. A trillion seconds is 32 thousand years, 31,688 years to be exact.

If we look at the world debt numbers, we can see they cannot be"paid off" by more than one country. To attempt to do so with austerity programs and taxation is morally wrong.

To put people and countries through decades and decades of pain would produce nothing but pain and would be a result of not comprehending the numbers. People will wake up. Countries will wake up. They will walk away from this nonsense.

The numbers must be realigned to save countries' economies and the global economy.

Below is the debt clock just for the united states of america. we must realign the global debt to end the current crisis.

national debt

"Chairman Greenspan has asked me to thank you for your letter and enclosure 'Solving World and National Economic Woes: Empowering a New Economy." Jennifer J. Johnson, Associate Secretary of the Board, Federal Reserve System, November 1992.

"Your recent communication to the International Monetary Fund has been received and duly noted." Bruno J. Mauprivez, Public Affairs Officer, International Monetary Fund, November 1992.

"New ideas are always welcomed and some help to develop new policies and programs." Finance Minister of France, November 1992.

"Your comments are most interesting." Jacques Attali, European Bank for Reconstruction and Development, November 1992.

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"Simple can be harder than complex: You have to work hard to get your thinking clean to make it simple. But it's worth it in the end because once you get there, you can move mountains."

Steve Jobs

The reason the global debt problem has not been solved, and will not be solved if our thinking does not change, is that we continue to make it more complex than it is. First, we must understand the numbers that represent the debts of the countries of the world. If we continue to not understand the enormity of the numbers we shall not solve the debt crisis. Austerity measures and taxation will not solve the global debt problem because the numbers are simply too large.

A trillion seconds equals 32,000 years, 31,688 years to be exact. World debt is over $49 trillion. Other liabilities dwarf this number when you consider unfunded liability commitments. The global debt cannot be paid off through austerity or taxation. It is the result of closed mental sets for the financiers to try using these methods. They are not thinking outside the box. They are stuck in their thinking. Evidence has shown that in the current global situation austerity programs do not work and that the end results have been to increase debt in many countries as a percentage of their gross national product. To put a burden on the populace in a futile attempt at handling the debt is wrong, morally wrong and mathematically wrong. Globally, and for each country, we need a new way forward to end the enormous debts the countries of the world face.

In 1992 this writer contacted all the major central banks in the world with an idea. It was proposed that debt realignment be accomplished globally. This idea is needed now more than ever. This realigns debts (debits) as assets (credits) to the creditor’s accounts, either in real terms, or in a ratio to be determined. This takes the burden off the people, eliminates all sovereign debt, funds the banks, and creates the means for capital improvements worldwide. It is the only win-win for all. It would be agreed upon by all the countries of the world and formalized at a global economic summit, then ordered and administered by their central banks. Along with global debt, global currencies would also be realigned, and each country should independently realign its mortgages. A good analogy for global debt realignment would be that of rebooting a computer when it freezes up. The world economy is heading for a freeze. or a total meltdown - you pick the analogy. The present methods are only buying time. We need to reboot the world economy.

To be truly global, debt realignment would include all governmental entities from every sovereign country down to the municipalities with every segment in between. It can be done and it should be done. In addition, if this can be done - and it can - on the global and national level, it can be done on the individual level also. A prime example is with mortgages, but other debt can also be realigned. Whether all of it or parts of it are accomplished will be determined by the vision of those in power. Global debt realignment to be truly global would include all. While this site primarily advocates global debt realignment as manifested by sovereign nations because even this seems difficult for financiers to get their heads around, let alone realigning all debt which would be truly remarkable, it must be reiterated: if debt can be realigned for some it can be for all.

These measures will allow the global economic order to fully function. Each governmental entity on the globe should have its debt realigned. This can be ordered internally with mortgages and certain internally owed debt, but sovereign debt realignment requires all countries to agree globally and participate. No one loses with global debt realignment. After global debt realignment the banks worldwide would have capital and public and private projects could be funded in every country. Global debt realignment is the only process that will work and which makes sense with the numbers we are dealing with, and if we are to use numbers as they were meant to be used, as representatives of something and not realities in themselves. It has often been said that every problem created by humans can be solved by humans. Either people control the numbers or the numbers control people. Right now, the numbers are controlling the people in charge to make emotional decisions based on restricted mental-sets without considering the size of the numbers, the debts themselves, or the feasibility of the possibilities presented by rebooting the global economic system with global debt realignment.

To overcome a problem, one must admit there is a problem. And the problem is not just debt, or deficits, it is a problem with an exponentially expanding series of numbers which do not reflect reality. They must be put back into perspective.

The world’s countries influence each other financially. The are interrelated. Presently, each country of the world suffering from financial instability has similar problems with housing price decreases, loans that are defaulting, lending institutions failing, and a crisis of confidence among the institutions themselves. Addressing each country's financial crisis separately, or even regionally, will not suffice. It will not work.

Debt realignment is distinguished from debt relief and debt forgiveness in that with debt realignment no entity loses. This is the core of the concept. In fact each participant gains. Debt realignment does not burden the taxpayer with sovereign debt or the debt of the “too big to fail” institutions. It alleviates the debt from both the countries and their peoples by realigning debits to credits. Instead of transferring the debt to someone else, the debt is realigned. Instead of governments being burdened with the debt, forcing austerity programs on nations and peoples the debt is realigned. This can be done with all sovereign debt. There is no reason it cannot be done except ignorance of the possibilities and ignorance regarding numbers, what they are and what they represent - or are supposed to represent.

Sometimes austerity works. Not now. There is too much to cut. Sometimes stimulus works. Not now. The problems are too deep and too broad. Now the world needs global debt realignment. If we just proceed as we have been globally we will see more banks fail. We still will see further credit problems. Housing prices will languish. Businesses will keep have difficulty getting loans. Jobs will dry up further. We still will have problems, because the core problem will not be solved. It would take years to overcome if it worked. But it cannot work because the debts (the numbers) are too large. We must get out in front of the problem and solve it -- nationally and globally. The bailouts did not work. Austerity will not work. Taxation will not work. With many countries the debt is too large to pay off. That is the reality. Debt realignment solves the problem, symptomatically and causally. The world markets would rally beyond imagination. It may be that controls will be necessary to keep things from overheating in the months following global debt realignment.

Sometimes we have an opportunity to do something, to turn it all upside-down, and create a new beginning. Such out-of-the-box thinking is difficult for most people, particularly for people who have rigid ideas about how things should work. It may be that it is particularly difficult for financial types. Balance sheets, "rules," and regulations -- many bent or discarded anyway -- are always popping up in a person's mind. But when things are not working and an expedient means is at hand, an innovative idea, a bold move into the future, we should take it to put things back in order. Innovative financial instruments to a large degree caused the present problems. Innovative ideas should be brought to the battle to eliminate the problems. All should reflect and ask: "What if we did this, what would be the results?"

Debt realignment would do more than any other idea because it solves several problems at once. It not only addresses the current crisis, it does it quickly. The world has the opportunity for a financial footing that can propel humankind forward in ways we presently do not imagine. We just need to think things through and utilize the tools we have at hand. The “innovative” financial instruments that were causal to the present difficulties must be met with an equally innovative idea. We must put out the smoldering fires around the world quickly and we must rebuild better, stronger, surer.

Millions of people in the debt ridden countries are protesting the current global economic aberration and runaway methodologies that have not semblance to favorable free-market capitalism or the remedies being presented as solutions to the global debt situation. President Barack Obama has stated: "I think people are frustrated, and the protesters are giving voice to a more broad-based frustration about how our financial system works. Now, keep in mind, I have said before and I will continue to repeat, we have to have a strong, effective financial sector in order for us to grow."

And, we need a strong effective global financial sector in order for global growth and progress. We cannot get there with the current austerity and taxation programs. We have to realize the enormity of the numbers (the debts) and that some of them cannot be repaid regardless of how heavy a yoke is put upon people. We cannot cut our way out of the global economic problem and cannot tax our way out. The only way out is Global Debt Realignment. To do so we must first consider the numbers.

sj@thedebtrealignmentinitiative.com

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