Comrade Bareentoo..
You are right to be suspicious about the possibility of such a body, because alternatives to the current banking system do not get allot of coverage.
This may have to do with the banks having 100% control over the media that would likely be covering this in the fist place.
Ok lets start..
The Financial system is a system a vast intricate system with many "bodies" and ofcourse Interest is a fundemental aspect of this, due to fractional reserve banking and the currencies generated from this.
We will have to replace it with another system.
As you know in today's developed ecenomies banks have the monopoly of money creation, and they d this every time they provide a loan to a business or a person,
every time this is done, they will create this amount out of thin air, and expect you to pay back the full amount plus interest..
The interest you will have to go out to the world, compete and get it..
In the past in many cultures around the world namly Pharoinic egypt, and throughout most of China, Korea and Japans history money was created corresponding to actual goods created usually by the governing body.
Confusius thought of merchants as the lowest of the low but he tolerated them as a necessity, in his order of the world farmers , artisans, soldiers and administrators where on top and merchants were at the bottom of the social scale just above slaves, this was extreme but whats interesting was his attitude to money lenders , he proposed the death penalty and their extermination like rats.
But thats an extreme view, in islam trade is highly thought of and our own prophet and most of the saxaaba were merchants...
State control over the creation of money is not what i propose even though the state should have some say in the long term planning and direction of the economy, money creation and management of supply should be in the hands of non-state actors but not banks.
A good example of this is Abraham lincoln during the Civil war...
In those days upto WW1 the worlds finances were controlled by London, because the British Empire had controll over the world gold market and the international gold standard.
Lincoln was having trouble financing the war and the gold standard constrained him, also the british were against the existance of a strong US that was out of their financial control and they supported the confederacy.
The war led to a shortage of currency through out the Union and thus led to deflation and a severe economic slump, while the Union government was goung heavily into debt and was nearly bankrupt and would not have been able to continue the war..
What did Lincoln do? he discarded the god standard told the british to fuck off, and started issuing government gaurenteed currency called the GreenBack Dollar.
This quickly took the country out of the slump and allowed the financing of the war and eventually victory.
Lincoln did not just print money and dump it, he also invested in massive infrasture projects like irrigation cananls, railways and also the granting of state lands and funds for the creation of dozens of state agricultural and engineering colleges.
These became the various state universities that you have today, thanks to honest Abe,
Coincidently when Lincon came to power there was another rising power that was starting to rebel against the power the financiars i.e the London, this was Czar Alexander the second of russia.
He started the modernization of russia in 1861 the same year as the start of the US civil war, and he and Lincoln became allies against the British financial control of their own countries and they both took identical
steps..
They both went off the gold standard albiet temporarily, and they both started massive economic reforms and the emancipation of slaves, in russias case the serfs that made up 90% of the population.
The results of their actions were clear to see, in 1861 both Russia and the US were second tier powers and France and the British were first tier powers and were more modern.
In 1861 Russia was less developed economically than the Ottomans, and even though 1878 was a fluke victory, the comparison between the unlucky but vastly more modern Ottoman army and the extremely primitive but well led Russian army was clear to see.
By 1900 both countries were on their way to bieng superpowers and the US unleashed the second industrial revolution in the electrical and the chemical industries in Germany.
Let me reiterate
State control over the creation of money is not what i propose even though the state should have some say in the long term planning and direction of the economy, money creation and management of supply should be in the hands of non-state actors but not banks.
You must be asking are there alternatives to the state, yes..
but before we address this let me explain that the formation of our current dominant business organizations.. The Corporation is due to the very system that we are trying to replace, so we must also replace the Corporation if we want to replace the current financial system.
You have seen how todays large corportations have bloated to enormous size, they have become less efficient, stifiling of innovation and in the case of US corportations e.g General motors , Ford and Chrysler
they have also failed to survive on their own without government intervention even though they had all the advantages given to them.
We have an unhealthy relationship between the corporations the financiers and governments and it is difficult today to determine where one ends , they are one and the same.
Politics has become a show for the masses and decisions are rarely influenced by elections or the "will of the people, or their interest".
The alternative is the cooperative .
Small and Medium enterprises make up most of the worlds economy and employ the vast majority of the working population, and cooperatives that bring them together can do every thing a corporation can do and do it better.
and these can also control their own credit and thus their own currencies..
The best examples are Spain's Mondragon Corporation.
http://en.wikipedia.org/wiki/Mondragon_Corporation
The thousands of small and medium enterprises in the Emillia romagna
http://www.community-wealth.org/_pdfs/a ... -logue.pdf
Both models do all the activities of corporations and do it more efficiently.
Both models control their own banks, their own insurance , the entire range of financial products that are provided by the banks.
Another example is the WIR bank
this was the sole survivor of the friewirschaft(free economy) movement of the 1930's that was inspired by Silvio Gesell.
Today it is still running strong.
http://www.swissinfo.ch/eng/business/Ca ... id=7613810
for more information read this, you may have to get it from your library or buy it
http://www.reinventingmoney.com/documents/wir.html
These are historical examples they are relevant but for under developed countries we will require something similiar but more suitable
http://www.lietaer.com/2010/05/bancodipalma/