BASEL III Question

I've read thru BASEL III, and don't see anything that requires currencies to be asset backed...only capital controls for commercial bank liquidity...anyone know where it states that currencies must be asset backed? Got a debate going with a few friends, any info would be helpful, thx all!

I have read a number of Basel III documents for the same reason. I have never found a single reference to a requirement for currencies to be asset backed. The issues deal with how much is a bank required to hold in reserve and how is that reserve calculated. My question has been if banks do not have control over whether a currency is fiat or asset backed how could they be required to be in compliance. Also Basel III applies to the entire world banking community not just the US. Every country would have to go to an asset backed currency in order for the banks in that country to be compliant. Another concern I have seen with Basel III is that the time frames for completion of each step extend out to 2019. The first deadline is for the minimum ratio of liquidity is Jan 1, 2013. A number of banks have already been certified as Basel III compliant for that first deadline and we don't yet have a currency that is asset backed. I think currency backed assets is a separate issue that may well be underway but I don't see any organization or country that can force it to happen worldwide. Anyway that is my take on the subject.

thx for the clarification Wind, much appreciated!