Monetary sovereignty, hard choices and snake oil salesmen

I've always rated Dr Ball and his comments on the subject of currency are to the point. Financial issues will not be solved by the creation of a currency symbol, however romantic. He makes no comment about Wales joining the Euro. But presumably this would not be available in the first instance.

Put this into context. Wales is the only country out of the four nations including those British island dependencies not to have its own printed currency or National Bank. Yes, Welsh Labour created a Development Bank of Wales, but it has no ability to print Welsh paper currency or function like a central bank does. One could be create if both Labour and Tories had the will, but they don't. They think of Wales as an appendage of England. Only Plaid Cymru would have the will to rectify this ongoing national slight and push for a independence referendum. The Development Bank was established by the Welsh Government to help businesses start up, strengthen, and grow by providing loans, equity investments, and other forms of financial assistance, that's all. It's a pretend bank. It's basically cosplay with capital. And we have the ridiculous situation due to our annexation by England in 1535 , and after the "British" pound was created in 1707 after the the Act of monetary Union, means that only Wales has English currency foisted on it. Imagine if we had our own real Bank of Wales. We'd have the ability to print Welsh paper currency, have real native British Monarchs finally on our money like Rhodri Mawr, Hywel Dda, Owain Glyndwr and others. Bards Aneurin & Taliesin. Scholars like the father of British history Gildas , monks Nennius and Geoffrey of Monmouth. Philosopher Bertrand Russell, PM David Lloyd George, NHS founder Nye Bevan. The list is endless. Oh but no welshman or woman will ever feature on a Bank of England note other than English Monarchs, their good bad and the ugly. This differs in Scotland and Northern Ireland , a country by the way that's only 124 years old. It not only has it's own printed paper & coinage, but control of its policing and criminal & youth justice systems. So I don't want any bleeding hearts British Unionists saying that I am deluded separatist when both Scotland & Northern Ireland have their own currency , National Banks and representation within the framework if this false United Kingdom that does Wales a disservice.

Great to see debate around the currency in an independent Wales. As the founder of Scotonomics, I am pleased to have contributed to the conversation. Dr Ball's article was all very 2014. It was a rehash (for me, anyway) of many of the arguments that persuaded Alex Salmond in 2013 to opt for a currency union. In the opinion of most commentators, it was that decision that sank the independence movement in Scotland. A decade later, we have almost a clean sweep of Indy supporting organisations who (at least on paper - yes, I am looking at the SNP leadership) support a Scottish currency as soon as practical. I hope Dr Ball and, no doubt, others with genuine concerns about the currency can avoid the painful journey that the Scottish independence movement had to travel before they found the only sensible position for a prosperous global North nation: its own sovereign currency. "The pound is understood and used by the people of Wales. Why present further problems when there is no need?" says Dr Ball. But couldn't you say that about any significant change, like, well, the Union? The point of independence in Scotland, and I am sure in Wales, is to have a very different type of economy. The central tool for this difference is the monetary unit of account. Most neoclassical/mainstream economists do not understand the power of money or the role of monetary institutions. Hence, the idea that money is simply neutral. As Wynne Godley wrote in his seminal short paper Maastricht and All That, "the power to issue its own money, to make drafts on its own central bank, is the main thing that defines national independence". Trying to persuade the people of Wales that independence is meaningful, or even possible, without your own currency is a losing strategy. It is a lesson that another nation has done for you. Don't make the same mistakes.

Interest rates and fiscal policy are not independent. A country that runs a fiscal deficit that it chooses to fund by debt will increase the supply of its bonds, forcing down their price (and hence raising the interest rate it has to pay. Paying interest on historic debt adds to a fiscal deficit.

Singapore is an interesting case study. They remained in a currency union with Malaysia for two years after independence before issuing the Singapore dollar which was exchangeable at par with the Malaysian dollar and pegged to sterling to maintain investor confidence, until sterling collapsed when they pegged to the US dollar. The concern about using sterling is not so much direct control of fiscal policy but whether the Bank For England can be a good faith partner or whether the institution that was kickstarted with the profits of slavery and bankrolled centuries of global exploitation will conspire with the ruling elite in London to ensure that a newly independent Wales does not succeed. It will do this because Wales is needed in englandandwales to stop England disintegrating back into the old Germanic kingdoms. So plan B must be to follow Northern Ireland into a transitional Celtic union with the Republic of Ireland, becoming EU members and adopting the Euro on day one.

I suggest that the obvious thing to do is look at Ireland which until it joined the ERM used Sterling I understand that the result for Ireland was not pretty Richard Murphy has a lot to say about currency options for an independent Scotland

This is very good. Personally I'm a supporter of Wales having its own currency, though probably for the exact opposite reasons to why its being advocated by Scotonomics and their supporters. Currency is just like any other commodity: when it's scarce its value goes up, and when it's abundant its value goes down. When countries that have their own currency issue too much of it, imagining that doing so will help them to cover their deficits, all that happens in practice is that the value of the currency goes down.  Beyond a certain point this leads to complete collapse - it's very easy to find examples of this, from Weimar Germany through Zimbabwe and Venzuela, and of course Argentina, before Javier Milei started to get a grip on things. And there are good reasons why Argentina hasn't ruled out abandoning its own currency altogether and using the US Dollar instead. So for a Welsh currency to be worth anything, there would have to be a Welsh government that practiced fiscal discipline and ran a balanced budget: about as different from the ideas of the current Welsh political class as could be imagined. But once established, it would *force* the government to balance its budget, precisely because of the consequences for its currency if it didn't. That seems to me like a good idea.

The economy of Wales is small and could be transformed quickly in the lead up to independence. He not only fails to have any conception of what currency-issuance implies, but is also depressingly defeatist on the notion of grown-up Wales taking responsibility for its future. He should come to the anti-austerity conference just over the border in Bristol in September and have a chat. https://modernmoneylab.org.uk/events/bristol-conference-2025/

Presumably, with the UK pound being an international currency, there would be nothing to stop an independent Wales from adopting the UK pound as its currency. But surely the same would apply to the Euro? If an independent Wales has the aim of joining the EU, adopting the Euro as it's currency could be one of the many steps needed to fulfil that aim.