Author: Siize Punabantu

Split-Velocity Solutions, Outreach 1st February 2019

To begin with anyone familiar with central banking history will know that there was a time that central banks kept gold in their vaults to back the value of currency in circulation. However, the gold standard was inevitably discarded for the simple fact that the value of gold may itself fluctuate over time, furthermore a system like this restricts a central bank’s capacity to issue new notes and coins to the availability of gold and can be quite costly to manage especially when a government needs to apply monetary policy to manage growth in an economy.

The gold standard was abandoned for good reason. Instead of measuring the value of a local currency against gold, central banks today instead monitor natural fluctuations in economic growth and increase or reduce money supply. This controls inflation levels and maintains the stability of a local currency. But as can be observed in Zambia where in the past few years the value of the Kwacha has fallen from US$1 – ZMK8 to US$1-ZMK12. This system is not perfect. In fact, it doesn’t really work, simply due to the fact that the Zambian Kwacha, in this system, is indexed against the natural propensity for the economy to grow over a period of time. Consequently, any shocks to the economy, such as drought, electricity deficits, a drop in copper prices, fall in forex reserves will hammer the value of the Kwacha and BOZ will be forced to ride these trends. It will only be able to mitigate against them using monetary policy, which is why the Kwacha must inevitably lose value as a buffer against declining economic performance. Put simply this places BOZ at the mercy of trends in the economy since the value of the Kwacha in the current system is indexed against economic performance, in the same way that a fall in the international gold price would affect local currency were it on the gold standard. Furthermore, increases in money supply using monetary policy must be supported by economic growth. In other words before BOZ can increase money supply it must first observe an increase in productivity or output in the economy.

Why Split Velocity technology is more valuable than the Gold Standard and more efficient than conventional Monetary Policy

The Gold Standard limits the capacity to back a national currency to the volume of gold held in the vaults of a reserve bank, the price of gold and other economic factors. Monetary policy limits a government’s capacity to back its national currency to the economic performance which can be quite poor when growth in GDP is minimal as is common in today’s economies. A Split-Velocity model backs a government’s national currency with economic value equivalent to 100% of GDP. Neither the Gold Standard nor current Monetary Policy come anywhere near this kind of strength and stability. Consequently governments are better able to and have the resources at hand to withstand shocks to the economy and easily counter shocks that would push an economy into recession. Whether these shocks are caused by natural disasters such as floods, earthquakes or are technical such as shortages of electricity, unemployment and poverty that governments may have trouble resolving today a Split-Velocity model on the other hand will be able to thenceforth counter these kinds of economic shocks with relative ease giving central banks the tools they need to support government.

A Split-Velocity Model is the first system or technology that allows central banks to control economic outcomes. For instance, whereas the Gold Standard is limited by the value of gold and amounts of it held in reserve; and Monetary Policy is dictated to by natural trends in economic growth over time, a Split Velocity model is not as weak or redundant as any of these approaches. It does not wait for a “price level” to be set by economic trends such as a natural growth of 3% experienced by the economy in one year. A Split Velocity model can allow a central bank to stimulate growth at constant price anywhere between 0 to 100% of GDP in one year. In other words, the central bank does not wait to see how the economy will perform, it now dictates how fast it wants that economy to grow over a given time frame.

This is unique in that no other technology/system offers central banks this kind of power over an economy. Mediocre natural growth rates such as 3% or 6% are now thrown out the window as the central bank can now harness as much as 100% of an economy’s capacity to grow over time [due to ending inefficiencies causing losses as a result of subtraction or implosion in the circular flow of income]. Since the central bank now controls the growth rate, it is no longer at the mercy of economic indicators, it now dictates them and can raise or slow down economic growth at will. Consequently, it now has near perfect control of the value of the national currency. For the Bank of Zambia, this means that the Zambian government, for the first time in Zambia’s history, would have at its disposal enough financial resources to end poverty in Zambia in just a few years. This is why we have made a submission to the Bank of Zambia for the introduction of a Split-Velocity system in Zambia.

This makes a Split Velocity Model more valuable than a Gold Standard when it comes to managing a national economy. It also means a Split Velocity Model or system is far more powerful, efficient, effective and advanced than any aspect of Monetary Policy currently being used by the Bank of Zambia [or any central bank in the world today for that matter] to manage a national economy.

This is why we want to run the pilot and eventually fully implement and deploy our Split Velocity system and showcase what it can do.

A Precautionary Note: Beware of uniformed nay sayers.

We have enough confidence that our innovation works that we would be brazen enough to suggest that even if you have a Master’s degree or PhD in Economics and/or Finance etc. it is unlikely that you are qualified to understand how split velocity works without allowing yourself to quantify it above and beyond your academic credentials and professional experience. If you were poverty would not exist today and this model would already be commonly in use to manage national economies. This is consequently outside the scope of what you have been taught or exposed to professionally over the years. To understand a split-velocity model and how it works to generate growth at constant price and be able to explain this to someone else you will have to apply yourself, otherwise you would probably do it a disservice by dismissing it or laughing it off. We are not saying this to seem superior, to be rude or to denigrate anyone’s qualifications. To understand it off the bat requires real intelligence not just a higher education. You may be well educated, but in regard to this era and area of knowledge it is likely you are not informed enough to understand it without some intellectual effort [above and beyond your qualifications] to do so.

To understand this model, you cannot rely solely on your tertiary education. There is no component of this that you were taught. Instead you must rely more on your intelligence, puzzle solving capacity, problem solving ability, capacity for analysis and abstract thought, basically your IQ. As has been mentioned, in the 250 or so years since the debut of economics the most brilliant minds in the world have failed to identify subtraction in the circular flow of income and formulate a commensurate solution to it that ends poverty.  Credit creation doesn’t solve this problem. It is a problem for which the solution is counter-intuitive, making it difficult to rationalize. Therefore, this is not as easy a problem to solve as anyone might presume, if it was, it would have been solved before this. Therefore you may underestimate it at the peril of your own future professional competency, when it runs and proves beyond all reasonable doubt that it works.

If you don’t understand how a split velocity model works, it quite literally may mean you are uninformed and that you have to try a little harder [we recommend you watch the videos, go through the math and read the book again]. In our view a split-velocity model is more reliable than a gold standard used in central banking and more efficient than monetary policy currently in use. The model does not need to be backed by gold, technically the technology or system is more stable than a system based on a gold standard when properly applied. This is due to the fact that a split velocity model can take money which is of little or no value and apply it in the economy in a distribution pattern or in such a way that it creates productivity, which in turn generates raw materials, goods and services of a measurable value at constant price making the need to hold gold to back a currency redundant and an unnecessary expense. Wealth creation solves the puzzle of how to increase money supply and stimulate growth at constant price and presents the solution in an economic model.

If you do not have a background in economics, business or finance etc. and someone who does cannot explain how a split velocity model works to you, or they tell you it doesn’t work, in all likelihood what they are revealing to you is they have not really understood how the model works, are too incompetent to explain it and are using your trust in their ability or qualifications to hide the fact that they have no genuine competence in this area. This is the plain truth. We have to be blunt about this. It is why we want to run the pilot, because quite frankly, why waste time on debate when the system can demonstrate what it does beyond the egoistic tendency of people blinded by their academic qualifications and professional experience to disregard new innovations. As Frank Herbert once wrote, “Education is no substitute for intelligence.” The adage certainly applies here. 

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Excerpt from Siize Punabantu’s 2010 Book: the Greater Poverty & Wealth of Nations

 Split-Velocity Solutions, Outreach 27th January 2019

In this excerpt from the book the Greater Poverty & Wealth of Nations Siize Punabantu analyses how inadequate theory in contemporary economics is responsible for poverty in the world. Unfortunately developing countries, unable to see past the imperfections in theory adopt the same inadequacies into their economies and experience even worse economic conditions than their more developed counterparts.

“Weaknesses in contemporary economic theory have created the greatest dystopian fantasy in human history where technocrats endorse the grand delusion that poverty must remain an indelible part of mankind’s socio-economic existence”. 

Enhancing the efficiency and effectiveness of money entails redesigning the economic and financial operating system. It has to be recognised that productivity is doing just fine. People and industries the world over work very hard to earn a living and to survive. Some nations or communities being more developed than others does not mean one or the other is lazy or more industrious. This is a common misconception that arises out of not having any answers. Generally, people and industries will dedicate themselves to doing whatever work they need to do to survive and live a decent life, developing countries are no exception. What distorts, complicates and diminishes the growth and development process is money and a sluggish economic and financial operating system that wastes much more than analysts are willing to give it credit for. Economic implosion permits a 3 percent gain in GDP whilst hiding a 97 percent waste or loss. This degree of inefficiency is caused by the way the operating system or circular flow of income allocates money. This ratio repeats itself in national and global settings by creating a very wealthy few and a not so well to do majority. Zambia, with poverty levels once as high as 80% in 2001 is no exception to this phenomenon. Even in the most industrialised nation in the world, the United States of America it will be found that a small percentage of the population are extremely wealthy, whereas the remaining majority is not as well to do in comparison whilst ghettos and slums harbour those who have fallen between the cracks. This pattern severely dilutes the capacity of the market in the United States and other parts of the world to act as a driving force for growth and development.

It becomes very clear that developing nations that are today inheriting these economic/financial theories and concepts and having them ‘downloaded’ into their socio-economic systems are being taken on the scenic route to prosperity. They are being taken to a destination it is likely the passengers will never live long enough to arrive at as the driver doesn’t know where he or she is going, but assures everyone that they do. Countries like Zambia receive accolades when GDP grows by three percent. This in itself is an affront to the intelligence and genuine desire to make progress needed by people living in poor nations. It’s like increasing the salary of the teacher who could not afford a bun for his sickly daughter by three percent per annum and telling him that in so doing he will one day be rich and able to fly his daughter abroad for medical attention and rather than a bun he’ll buy her imported chocolate cake, maybe –  but he will have to wait the next 500 or so years, only he will not live that long. It is the expectation that by following Scarce Resource Theories (SRT) prescriptions you’ll one day be a developed nation, just hang in there. Developing countries that direly need assistance lap up these ideas and it can become a pass time of academics and scholars in respectable policy making institutions around the world to hold up hoops to see if people in poor countries can jump through them then wait to see for how much, or which new theory they’ll keep doing it for before they get bored and the bother of thinking up another policy or theory comes round. The pageant of popular ideas keeps coming around and the latest fad as to the cause or solution to development and poverty swings its hips up and down the runway to the awe and applause of the gallery.

There is a very real danger in this predicament. The global efficiency of the present day economic operating system is hazardously low. When an economy grows by 3%, even that of a developed region like North America or the European Union, it means, in terms of efficiency, that for every dollar or euro spent three cents worth of productivity was realised while 97% was lost or wasted, not necessarily by corruption, lack of good governance, lack of priorities, poor accounting practices, management errors, misuse or any other easily blamable human weakness, but by implosion [subtraction] within the economic operating system. These proportions speak volumes. Academic institutions have not allowed economic theory to evolve sufficiently enough to appreciate this digression, in fact analysts and planners are taught to give a standing ovation to low growth rates. Such low performance margins are rapidly creating an aggregated process of diminishing returns. This means that developed nations are getting wealthier [and growing] far too slowly to tow poorer countries out of poverty, but in the meantime are saying to poorer countries you should strive to be like us, yes copy what we are doing if prosperity is what you are after. Some developing countries will get poorer as their stock of wealth is not growing fast enough to sustain the aggregate socio-economic needs of their populations. Nobody sees this as observers have been taught to marvel at mediocrity and the belief that it is developing countries that are holding global development back by being a perpetually broke family member of the ‘rich’ world. The core economic and financial systems of developed countries are poorly designed, their fundamentals are too deeply flawed and to make matters worse these dysfunctional approaches to the management of economies are being replicated in developing economies. In essence it means paltry annual growth rates will be incapable of coping with global increases in population and human needs augmented over time. Faulty economic theory sees resources as finite and people’s infinite wants as a liability. This in turn leads to policies that exasperate human development. The gap between the rich and poor, developed and developing will continue to grow further increasing tensions and hostilities. Resources will become increasingly scarce leading to periods of domestic unrest, xenophobia, tensions in trade amongst peoples and between nations. Even credible academic institutions sometimes fail to see the real faults in present day economic theory. No one wants to see this continue and institutions have to take the challenge to carry out extensive reform in economic theory that will avoid this. Ultimately we should be one nation, one people who share one fortuitous destiny.

Very often developing countries, like the struggling school teacher or the failure of Anglo-American Corporation to make Konkola Copper mines in Zambia successful, are blamed for the difficulties they face. When we see children with large hungry eyes and swollen bellies, failing industries, men and women covered in dust as they quarry rocks to make a living, companies filing for bankruptcy, countries laden with debt and millions of people without hope, governments failing to cope with the socio-economic needs; it is not due to the developing world being backward or due to the school teacher who cannot buy his daughter a morsel not working hard enough. It is due to fundamental economic theories, systems and concepts in the industrialised world being built on an archaic contemporary economic (CE) system. Though this system is mistakenly considered exoteric and progressive it leaves a lot to be desired when it comes to the generation of national and international wealth sufficient to completely change the landscape of resource availability the world experiences. This operating system is designed to create growth with development far too sparingly in the very heart of the industrialised world itself where the immediate problem lies. There is thus a perpetual depression in global demand which possibly functions far below its full potential and that will generally be prone to periods of collapse. Metal and raw material prices on the LME remain far below what they should be nudging primary sectors that the developed world relies on, into dire straights. What is unfortunate is that people living in the developing world have been taught to celebrate these ideas and take the blame for mediocrity and underdevelopment to the extent that social norms impose a subculture of inferiority that many workers in the developing world have to deal with on an ongoing basis by often being paid much less than what their counterpart from a “more developed” part of the world may earn. Yet all the while even they don’t realize they should be in a much higher place economically, not alone but with the very people they burden with economic discrimination. It reads much like a Greek tragedy where the “educated gods”, in preaching economic salvation, have enslaved the world by failing to see that they themselves reside in the very same ignorance and scarcity. They reside deep in the very bondage they desire to emancipate those who embrace their doctrine from. In propagating sound economic and financial doctrines that are ill-conceived at the fundamental level they are unknowingly sustaining the very suffering, division and poverty they are trying earnestly to mitigate against or bring to an end.

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27th August 2020

Split Velocity offers Hope for Recovery


We tried to forewarn and inform about the weaknesses of current strategies.


On Tuesday 25th June 2019 [a year ago] under the heading “Ending poverty by default: A challenge for this age” [scroll further down to read this] we alerted the central bank to the inadequacy of applying conventional monetary policy strategies initiated by the monetary policy committee at the time. An economy facing stagflation that is at the limits of its borrowing capacity (Zambia is at 70%) is generally out of options. Its only recourse is to find a benefactor to borrow from. It was hoped and it is still hoped one would be found for Zambia and being patriotic, like everyone else, we still hope this works out.

However, textbook approaches to economic management do not work for developing countries due to the fact that they are generally created for Western models where economies are wealthier and have access to hard currencies. For developed countries to doggedly follow the same style of management as developed countries when developing countries do not have hard currencies and are resource constrained rather than resource endowed does not make sense, in fact it defies logic. It is also important for African nations to be wary of the fact that even state of the art theories and understanding of economics in the world today applied by developed nations has not advanced to where they have identified the unconscionable and pointless waste or loss of income caused by a poorly designed circular flow of income.

Developed countries, at least by contemporary standards, are wealthy. This is evident in their much higher GDP and per capita incomes. Therefore, their primary concern for decades has been how to contain this wealth and not lose it. This has subconsciously influenced the knowledge paradigm that is economic theory today. Since the objective is to contain wealth, the focus is not wealth creation. Even mediocre annual growth rates are sufficient to maintain the status quo of existing wealth. Mediocre growth rates of 4% or 5% are sensible in the context of the huge sums in GDP they are applied to. It explains why they have never identified losses due to inefficiency of the CFI. They have never had a need to identify methods for rapid or accelerated growth. Developing countries are poor. In comparison they have much lower GDP and per capita incomes. Nevertheless, they implement the very same knowledge paradigm for economic theory and confidently pursue the same 4%-5% growth rates applied to insignificant GDP and therefore unsatisfactory economic gains that perpetuate their own underdevelopment whilst leaving them wondering why poverty does not seem to end. Since they don’t have any wealth to contain, what they are in effect containing and sustaining, in state of the art practice, is their own poverty perpetuated by a knowledge paradigm that believes slow or mediocre annual growth is accurate, worth aspiring to and they mistake this position for conventional wisdom to live by.

Resource constrained countries struggling with underdevelopment, poverty and debt simply cannot sit back and allow these lapses in theory and the valuable resources that could be put to good use laid waste, further ravage their economies. If this is the path that remains and continues then more inflation, underdevelopment, an unmanageable economy, difficulty and suffering may be the inevitable result. Nevertheless, there is always hope and ways to navigate the economy toward prosperity can be strategized.

Applying a Split Velocity system for managing a national economy is ideal for developing countries like Zambia because it assumes the nation has no resources, must rely on its own ingenuity and act within its own capacities. SV-Tech assumes any country applying the methodology is resource constrained and therefore must find alternative ways of generating its own internal financial resources to enhance productivity whilst maintaining price and financial system stability.

A Split Velocity model unlocks the equivalent of GDP at constant price. This revised strategy would unlock the equivalent of up to US$26 billion for the Zambian economy (that is, the equivalent of GDP per annum) as well as new monetary policy tools with which to wrestle the Zambian Kwacha from US$1 – K18 back down to US$1 – K1 if this kind of parity was desired by the central bank. It would do this with results gained in record time.

Unlike other strategies, though unconventional, a Split Velocity model is safe, guarantees its outcomes and is grounded in sound financial practice and productivity. Most importantly it is self-reliant, countries do not have to look for a benefactor to help bail them out of crisis, they can use their own tenacity and initiative to raise the resources they need sustainably to transform the lives of citizens.

It is important to note that even with current development strategies the forecast per capita income for Zambia in 2030 is US$1,639.00 – US$2,185 (MoF). This is an alarmingly low increase of US$300 – US$878 after 10 years of economic activity – (a gain of US$87 per year -Zambia may not meet the 7NDP goals and may be worse off in 2030 than it is today, except with a much bigger population notwithstanding unanticipated shocks for which there is currently little or no capacity for mitigation). There is a need to address what realistic difference a per capita income gain of only US$87 a year for 10 years will make in people’s lives, especially if there are unexpected shocks as a risk factor along the way, before this time is lost and can never be regained. On the other hand Split Velocity offers per capita income advances over the same period of up to US$26,714.15 per capita with guarantees, no unnecessary losses to inflation that make results redundant and provisos inherent within the system to deflect shocks to the economy that may interfere with objectives.

Let it be noted that this change in per capita income only deploys 42%-48% of the resources . made available by the Split Velocity System. In other words it does not stretch either the resources or imagination of this technology and its capacity to transform the Zambian economy. The only barrier is the mindset of technocrats. In fact the straight forward capacity of developing economies to achieve these results is demonstrative of how far behind the learning curve developing countries and managers have fallen by trying to implement approaches more suitable for wealthier economies than their own.

This means that a Split Velocity system continues to offer hope as a means that can be deployed for transforming the economy especially in the wake of unexpected shocks. It leaves no ambiguity as to where the resources are with which to achieve these gains. This is achieved without even maximizing or exhausting the resources generated by the Split Velocity system. It is not peddling fairy tales or fantasies, and is not based on guesstimations but provides hard facts and mechanisms for achieving results that will not disappoint implementors in both developed and developing countries.

See the tables below to see how much developing countries in Africa are losing daily and annually to an inefficient and faulty economic operating system in the circular flow of income (CFI). The recovery of these resources could be used to transform lives.

23rd June 2020

Enhancements SV-Tech can bring to the SDR system

A Split Velocity system manages price stability and is capable of wiping out chronic inflation for governments that struggle with either a depreciating or appreciating currency. The table below highlights the benefits SV-Tech can bring to the Special Drawing Rights (SDR) system.

8th June 2020

Discerning if Innovation and Technology adds Value to Precious Metals

The options for maintaining price stability being observed here are innovation and technology (e.g. SV-Tech) as opposed to precious metal (e.g. gold). Which is the most useful?

If you have performed the Instruction Set for a Legally Admissible Empirical Test for Split Velocity then you have successfully evaluated Split Velocity by way of empirical test.

Let us now compare SV-Tech (Split Velocity) to Purchasing Gold as a means of maintaining price stability.

The Instruction Set for the Empirical Test revealed a money supply deficit equivalent to GDP [-(B+C)] caused by subtraction. It was further noted that this represented a correction of money supply and not an increase in money supply. Therefore, this enables a correction equivalent in domestic currency value to GDP at constant price.

This means that the empirical test shows that the Split Velocity system is able to support, hold or maintain the Zambian exchange rate, for example US$1 to K5 or US$1 to K1 by the equivalent of GDP per annum or US$25.8 billion in 2018. In essence SV-Tech allows a domestic currency to behave like and gain many of the attributes of a hard currency, a system that has never been possible prior to SV-Tech or achieved before in central banking history. In fact, even in terms of the scalar increase of money supply, an IMF reserve currency cannot be used to increase money supply in this way at constant price (without inflation). Furthermore, the supply of gold cannot be increased on a scalar level, at constant price (because the price of gold would fall as a result of over supply). In this regard a Split Velocity system outperforms both gold and hard currency, a feat currently regarded as impossible or improbable. Consequently, where credibility and currency stability are concerned it even outperforms the Special Drawing Rights (SDR) reserve currency system presently in use by the International Monetary Fund (IMF), which is much weaker than a Split Velocity system. SV-Tech is at the very cutting edge of the Fintech space. The SDR system was introduced in 1969, a period when emoney, internet banking, debit and credit cards, cryptocurrencies and tech based financial innovations did not exist, therefore it should come as no surprise that innovations in the Fintech space will inevitably evolve that can achieve the same objectives as the SDR and that encourage a more inclusive approach to how currencies are managed and appraised. At the technical level, the fact that it can be demonstrated that where price stability, economic strength and reliability are concerned, a currency managed using a Split Velocity model outperforms a currency in the SDR system should be good news in that it complies with the merits for which the SDR system was created and exists in the first place. This development will allow for less discrimination when it comes to how domestic currencies are viewed.

For any central bank in the world, to be able to back its domestic currency with the same strength as a Split Velocity system it would have to be able to purchase and hold gold per annum equivalent to its annual national GDP. (To add some perspective to this, not even the United States Federal Reserve Bank has the capacity to back the US dollar at this level, to do this, it would have to upgrade to a Split Velocity System).

This means that for the central bank to be able to back the Zambian kwacha and exchange rate with the same capacity as Split Velocity, it would have to purchase and hold US$25.8 billion worth of gold and maintain the equivalent in GDP in gold as a reserve. ZCCM-IH and mines in general in Zambia are unable to produce this much gold, and even if they could produce and supply it, government could simply not afford to buy it all.

In addition to this, depending on market conditions, the price of gold rises and falls forcing a central bank to ride unpredictable trends, whereas a Split Velocity system maintains price stability even while economic conditions rise and fall. A Split Velocity model, when used to manage a national economy, is not subject to economic indicators, rather, economic indicators are subservient to a Split Velocity model. For instance, it does not wait to see what economic growth will be experienced, it sets and guarantees the growth rate.

Frankly, when it comes to price and financial system stability, gold and other precious metals need Split Velocity to maintain and sustain their value by sustaining higher levels of economic growth and maintaining a stable national economy. When it comes to financial system stability, this is one condition in which innovation is the more advantageous option.

Its important to understand that natural resources and mineral wealth are not a panacea for economic growth and national prosperity, the thought and strategy must delve much deeper and move far beyond this obstacle by appreciating that any price stability or grandiose economic benefit that any precious mineral like gold or other natural resource could deliver for the country would have already been delivered by copper, by now. There is a need to push beyond these limitations with the understanding that some countries with no natural resources have industrialized and formulate a strategy that scrutinizes the operational structure of the systems in place by which development objectives are achieved.

To discover minerals such as gold and other precious minerals is always beneficial to a country and its people and should receive as much attention and support as possible. We live in a technical age in which innovations like SV-Tech represent safe hands when it comes to the direction to take towards creating a better life and a better world for the youth, without leaving anyone behind.

Mining and precious minerals are cardinal to development, have their uses and should be invested in, nevertheless, for a central bank, anywhere in the world, purchasing gold as a way of trying to maintain financial system stability, is in no uncertain terms, simply no comparison whatsoever to deploying a Split Velocity system.

The raw power, dynamic capacity for growth and agility of finance in a Split Velocity system means that any country managed on this system can enjoy the benefits of a domestic currency that performs at the same level of stability and reliability as that of a hard currency backed by a fully industrialized economy and with less of the kind of volatility seen in the currencies of developing economies.

The mechanisms it innovates to be able to do this are fairly easy to demonstrate.

When reference is made to a need to advance the knowledge paradigm in economics, finance, accounting and business it should be emphasized that retraining is required to understand the counter-intuitive processes of a Split Velocity system. For instance, if a student graduated today they would still be trained to believe the CFI is efficient and lossless. However, the empirical test for Split Velocity clearly shows that the CFI is dysfunctional and inefficient in a manner anyone, even laypersons, can see and understand, and it is creating monetary and fiscal instability, makes global poverty inherently unmanageable as well as costing governments billions of dollars.

Similarly, the generic tutelage in finance is that an increase in money supply will cause inflation, or the over supply of any product such as gold will cause a drop in price. If a student graduated from university today this is what they would believe. However, we can provide an empirical test to teach and demonstrate, even to laypersons, that a Split Velocity model allows increases in money supply to take place at constant price. Instead of inflation the economy experiences the inverse, that is, economic growth. No currency in the world today, not even that of industrialized nations or even a precious metal can maintain price stability in this way. This is very important for developing countries because it means in a Split Velocity system the domestic currency can technically perform more efficiently than any present day reserve currency belonging to an industrialized nation.

These are just the facts. Developing countries should not believe they are trapped by poverty and circumstance. Prosperity belongs to all nations and all people, not just a select few. The knowledge paradigm is key.

Most importantly, by acting diligently and expediently, this means that it is possible today to guarantee the youth a future without uncertainty, with opportunity and economic independence, not as a lofty or empty promise, but with a working strategy that will deliver within this generation.

27th August 2020

Split Velocity offers Hope for Recovery


We tried to forewarn and inform about the weaknesses of current strategies.


On Tuesday 25th June 2019 [a year ago] under the heading “Ending poverty by default: A challenge for this age” [scroll further down to read this] we alerted the central bank to the inadequacy of applying conventional monetary policy strategies initiated by the monetary policy committee at the time. An economy facing stagflation that is at the limits of its borrowing capacity (Zambia is at 70%) is generally out of options. Its only recourse is to find a benefactor to borrow from. It was hoped and it is still hoped one would be found for Zambia and being patriotic, like everyone else, we still hope this works out.

However, textbook approaches to economic management do not work for developing countries due to the fact that they are generally created for Western models where economies are wealthier and have access to hard currencies. For developed countries to doggedly follow the same style of management as developed countries when developing countries do not have hard currencies and are resource constrained rather than resource endowed does not make sense, in fact it defies logic. It is also important for African nations to be wary of the fact that even state of the art theories and understanding of economics in the world today applied by developed nations has not advanced to where they have identified the unconscionable and pointless waste or loss of income caused by a poorly designed circular flow of income.

Developed countries, at least by contemporary standards, are wealthy. This is evident in their much higher GDP and per capita incomes. Therefore, their primary concern for decades has been how to contain this wealth and not lose it. This has subconsciously influenced the knowledge paradigm that is economic theory today. Since the objective is to contain wealth, the focus is not wealth creation. Even mediocre annual growth rates are sufficient to maintain the status quo of existing wealth. Mediocre growth rates of 4% or 5% are sensible in the context of the huge sums in GDP they are applied to. It explains why they have never identified losses due to inefficiency of the CFI. They have never had a need to identify methods for rapid or accelerated growth. Developing countries are poor. In comparison they have much lower GDP and per capita incomes. Nevertheless, they implement the very same knowledge paradigm for economic theory and confidently pursue the same 4%-5% growth rates applied to insignificant GDP and therefore unsatisfactory economic gains that perpetuate their own underdevelopment whilst leaving them wondering why poverty does not seem to end. Since they don’t have any wealth to contain, what they are in effect containing and sustaining, in state of the art practice, is their own poverty perpetuated by a knowledge paradigm that believes slow or mediocre annual growth is accurate, worth aspiring to and they mistake this position for conventional wisdom to live by.

Resource constrained countries struggling with underdevelopment, poverty and debt simply cannot sit back and allow these lapses in theory and the valuable resources that could be put to good use laid waste, further ravage their economies. If this is the path that remains and continues then more inflation, underdevelopment, an unmanageable economy, difficulty and suffering may be the inevitable result. Nevertheless, there is always hope and ways to navigate the economy toward prosperity can be strategized.

Applying a Split Velocity system for managing a national economy is ideal for developing countries like Zambia because it assumes the nation has no resources, must rely on its own ingenuity and act within its own capacities. SV-Tech assumes any country applying the methodology is resource constrained and therefore must find alternative ways of generating its own internal financial resources to enhance productivity whilst maintaining price and financial system stability.

A Split Velocity model unlocks the equivalent of GDP at constant price. This revised strategy would unlock the equivalent of up to US$26 billion for the Zambian economy (that is, the equivalent of GDP per annum) as well as new monetary policy tools with which to wrestle the Zambian Kwacha from US$1 – K18 back down to US$1 – K1 if this kind of parity was desired by the central bank. It would do this with results gained in record time.

Unlike other strategies, though unconventional, a Split Velocity model is safe, guarantees its outcomes and is grounded in sound financial practice and productivity. Most importantly it is self-reliant, countries do not have to look for a benefactor to help bail them out of crisis, they can use their own tenacity and initiative to raise the resources they need sustainably to transform the lives of citizens.

It is important to note that even with current development strategies the forecast per capita income for Zambia in 2030 is US$1,639.00 – US$2,185 (MoF). This is an alarmingly low increase of US$300 – US$878 after 10 years of economic activity – (a gain of US$87 per year -Zambia may not meet the 7NDP goals and may be worse off in 2030 than it is today, except with a much bigger population notwithstanding unanticipated shocks for which there is currently little or no capacity for mitigation). There is a need to address what realistic difference a per capita income gain of only US$87 a year for 10 years will make in people’s lives, especially if there are unexpected shocks as a risk factor along the way, before this time is lost and can never be regained. On the other hand Split Velocity offers per capita income advances over the same period of up to US$26,714.15 per capita with guarantees, no unnecessary losses to inflation that make results redundant and provisos inherent within the system to deflect shocks to the economy that may interfere with objectives.

Let it be noted that this change in per capita income only deploys 42%-48% of the resources . made available by the Split Velocity System. In other words it does not stretch either the resources or imagination of this technology and its capacity to transform the Zambian economy. The only barrier is the mindset of technocrats. In fact the straight forward capacity of developing economies to achieve these results is demonstrative of how far behind the learning curve developing countries and managers have fallen by trying to implement approaches more suitable for wealthier economies than their own.

This means that a Split Velocity system continues to offer hope as a means that can be deployed for transforming the economy especially in the wake of unexpected shocks. It leaves no ambiguity as to where the resources are with which to achieve these gains. This is achieved without even maximizing or exhausting the resources generated by the Split Velocity system. It is not peddling fairy tales or fantasies, and is not based on guesstimations but provides hard facts and mechanisms for achieving results that will not disappoint implementors in both developed and developing countries.

See the tables below to see how much developing countries in Africa are losing daily and annually to an inefficient and faulty economic operating system in the circular flow of income (CFI). The recovery of these resources could be used to transform lives.

23rd June 2020

Enhancements SV-Tech can bring to the SDR system

A Split Velocity system manages price stability and is capable of wiping out chronic inflation for governments that struggle with either a depreciating or appreciating currency. The table below highlights the benefits SV-Tech can bring to the Special Drawing Rights (SDR) system.

8th June 2020

Discerning if Innovation and Technology adds Value to Precious Metals

The options for maintaining price stability being observed here are innovation and technology (e.g. SV-Tech) as opposed to precious metal (e.g. gold). Which is the most useful?

If you have performed the Instruction Set for a Legally Admissible Empirical Test for Split Velocity then you have successfully evaluated Split Velocity by way of empirical test.

Let us now compare SV-Tech (Split Velocity) to Purchasing Gold as a means of maintaining price stability.

The Instruction Set for the Empirical Test revealed a money supply deficit equivalent to GDP [-(B+C)] caused by subtraction. It was further noted that this represented a correction of money supply and not an increase in money supply. Therefore, this enables a correction equivalent in domestic currency value to GDP at constant price.

This means that the empirical test shows that the Split Velocity system is able to support, hold or maintain the Zambian exchange rate, for example US$1 to K5 or US$1 to K1 by the equivalent of GDP per annum or US$25.8 billion in 2018. In essence SV-Tech allows a domestic currency to behave like and gain many of the attributes of a hard currency, a system that has never been possible prior to SV-Tech or achieved before in central banking history. In fact, even in terms of the scalar increase of money supply, an IMF reserve currency cannot be used to increase money supply in this way at constant price (without inflation). Furthermore, the supply of gold cannot be increased on a scalar level, at constant price (because the price of gold would fall as a result of over supply). In this regard a Split Velocity system outperforms both gold and hard currency, a feat currently regarded as impossible or improbable. Consequently, where credibility and currency stability are concerned it even outperforms the Special Drawing Rights (SDR) reserve currency system presently in use by the International Monetary Fund (IMF), which is much weaker than a Split Velocity system. SV-Tech is at the very cutting edge of the Fintech space. The SDR system was introduced in 1969, a period when emoney, internet banking, debit and credit cards, cryptocurrencies and tech based financial innovations did not exist, therefore it should come as no surprise that innovations in the Fintech space will inevitably evolve that can achieve the same objectives as the SDR and that encourage a more inclusive approach to how currencies are managed and appraised. At the technical level, the fact that it can be demonstrated that where price stability, economic strength and reliability are concerned, a currency managed using a Split Velocity model outperforms a currency in the SDR system should be good news in that it complies with the merits for which the SDR system was created and exists in the first place. This development will allow for less discrimination when it comes to how domestic currencies are viewed.

For any central bank in the world, to be able to back its domestic currency with the same strength as a Split Velocity system it would have to be able to purchase and hold gold per annum equivalent to its annual national GDP. (To add some perspective to this, not even the United States Federal Reserve Bank has the capacity to back the US dollar at this level, to do this, it would have to upgrade to a Split Velocity System).

This means that for the central bank to be able to back the Zambian kwacha and exchange rate with the same capacity as Split Velocity, it would have to purchase and hold US$25.8 billion worth of gold and maintain the equivalent in GDP in gold as a reserve. ZCCM-IH and mines in general in Zambia are unable to produce this much gold, and even if they could produce and supply it, government could simply not afford to buy it all.

In addition to this, depending on market conditions, the price of gold rises and falls forcing a central bank to ride unpredictable trends, whereas a Split Velocity system maintains price stability even while economic conditions rise and fall. A Split Velocity model, when used to manage a national economy, is not subject to economic indicators, rather, economic indicators are subservient to a Split Velocity model. For instance, it does not wait to see what economic growth will be experienced, it sets and guarantees the growth rate.

Frankly, when it comes to price and financial system stability, gold and other precious metals need Split Velocity to maintain and sustain their value by sustaining higher levels of economic growth and maintaining a stable national economy. When it comes to financial system stability, this is one condition in which innovation is the more advantageous option.

Its important to understand that natural resources and mineral wealth are not a panacea for economic growth and national prosperity, the thought and strategy must delve much deeper and move far beyond this obstacle by appreciating that any price stability or grandiose economic benefit that any precious mineral like gold or other natural resource could deliver for the country would have already been delivered by copper, by now. There is a need to push beyond these limitations with the understanding that some countries with no natural resources have industrialized and formulate a strategy that scrutinizes the operational structure of the systems in place by which development objectives are achieved.

To discover minerals such as gold and other precious minerals is always beneficial to a country and its people and should receive as much attention and support as possible. We live in a technical age in which innovations like SV-Tech represent safe hands when it comes to the direction to take towards creating a better life and a better world for the youth, without leaving anyone behind.

Mining and precious minerals are cardinal to development, have their uses and should be invested in, nevertheless, for a central bank, anywhere in the world, purchasing gold as a way of trying to maintain financial system stability, is in no uncertain terms, simply no comparison whatsoever to deploying a Split Velocity system.

The raw power, dynamic capacity for growth and agility of finance in a Split Velocity system means that any country managed on this system can enjoy the benefits of a domestic currency that performs at the same level of stability and reliability as that of a hard currency backed by a fully industrialized economy and with less of the kind of volatility seen in the currencies of developing economies.

The mechanisms it innovates to be able to do this are fairly easy to demonstrate.

When reference is made to a need to advance the knowledge paradigm in economics, finance, accounting and business it should be emphasized that retraining is required to understand the counter-intuitive processes of a Split Velocity system. For instance, if a student graduated today they would still be trained to believe the CFI is efficient and lossless. However, the empirical test for Split Velocity clearly shows that the CFI is dysfunctional and inefficient in a manner anyone, even laypersons, can see and understand, and it is creating monetary and fiscal instability, makes global poverty inherently unmanageable as well as costing governments billions of dollars.

Similarly, the generic tutelage in finance is that an increase in money supply will cause inflation, or the over supply of any product such as gold will cause a drop in price. If a student graduated from university today this is what they would believe. However, we can provide an empirical test to teach and demonstrate, even to laypersons, that a Split Velocity model allows increases in money supply to take place at constant price. Instead of inflation the economy experiences the inverse, that is, economic growth. No currency in the world today, not even that of industrialized nations or even a precious metal can maintain price stability in this way. This is very important for developing countries because it means in a Split Velocity system the domestic currency can technically perform more efficiently than any present day reserve currency belonging to an industrialized nation.

These are just the facts. Developing countries should not believe they are trapped by poverty and circumstance. Prosperity belongs to all nations and all people, not just a select few. The knowledge paradigm is key.

Most importantly, by acting diligently and expediently, this means that it is possible today to guarantee the youth a future without uncertainty, with opportunity and economic independence, not as a lofty or empty promise, but with a working strategy that will deliver within this generation.