The scoop: the IMF published a statement calling the pandemic recovery plan a ‘new Bretton Woods moment’.
What is Bretton Woods? Bretton Woods was an international conference that took place in 1944 with the goal of preventing another World War by establishing a new international monetary framework.
The legacy of Bretton Woods: Although the agreement no longer serves a purpose in the modern world, its effects are still being felt; there is more negotiation between nations both economically and politically and the global market is more interconnected than ever before.
Lessons for coronavirus, globalization:
1. Make politics people-oriented
Leaders and policy-makers of international organizations are motivated by self-interest and private sector pressure. Likewise, they propose policies that favor private interest and hurt the average worker.
2. Make international finance fair and equal
Loan conditionalities from the IMF are often attached without serious consideration for the interest of the borrowing nation or its citizens. Recommendations by the World Bank and IMF don't always resolve economic hardships for developing nations.
Bottom line: If this is a new Bretton Woods moment, perhaps we can learn a thing or two about our convoluted past of international do-good. Rather than just hit the reset button, we should consider how poverty alleviation requires more than a paycheck.
Dig deeper → 8 min
The scoop: Last week, Ripple’s CEO made an ambitious commitment to go carbon net-zero by 2030 in collaboration with conservation Rocky Mountain Institute and REBA, and pressured other crypto companies to do the same.
- Unlike Bitcoin, Ripple (XRP) was built with a finite supply (100 billion) at its inception, making it easier to control mining activities and mitigate its environmental footprint.
- Compared to Bitcoin’s 4.51 billion lightbulb hours needed to mine it, the XRP Ledger uses just 79,000.
- A lot needs to happen to make do on that claim, but Ripple is the first crypto looking to go carbon net-zero, and they have a plan (see below).
Bottom line: I don’t know if Ripple, Ethereum, and Bitcoin will one day replace Euros, Dollars and Yuan. With that said, why not bet a dollar on the possibility that they one day could?
Dig deeper → 3 min.