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| Mar 16, 2010 2:03 am |
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re: re: Economic Capture - Money Power in the World |
John Stephen Veitch
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Hello John Stone
There is less knowledge and understanding here than you might imagine. Much of the discussion above deals with the propaganda of money supply and isn't really very informative after all.
In the last two weeks I have tried to come up to speed on this topic. Very few people understand money supply. Economists hardly understand it at all. For them money supply is a given, controlled by politics, and not part of their economic models. (Governments often neglect to adequately control the money supply. Political life is easier if there is too much money around. Hence inflation is normal. (Inflation robs everyone, but you can't see it happening.))
Economists, cleverly, never argue about the distribution of wealth in the same way. "Our concern is the efficiency of the system. The distribution of wealth is a political problem." (Governments usually neglect this duty.)
Now to pick apart your statement, John:
"Our current money is backed by nothing"
Not true. The money you have is backed by the confidence of the community that other people will accept it in return for goods and services. It's especially important that banks and the government will accept it as full and final payment on debt and taxes.
"the current monetary system only works if there is debt. When a person signs for a loan, say 100.00. The bank issues a piece of paper that tells the person they owe 100.00 plus a usury."
Remove the word "usury" and insert "interest" and that's valid except "only" is a bit strong. There is a legal arrangement between governments and banks. Banks create money out of nothing, it's just a number in a ledger. But there are rules about how they do this, because if they create too much, the money becomes worthless. That's also why banks are very tough to deal with if you default on your loan. They are maintaining the "value" of the currency.
There are lots of other ways to create money. (Hence "only" is wrong) But for this discussion the principle that "banks create money" is valid.
"The 100.00 is created out of thin air, because it has no backing with precious metals, but the usury is not created thus leaving the system short?"
The statement is 100% propaganda. It's commonly said, but it's wrong.
John Stephen Veitch; The Network Ambassador
Open Future Limited - http://www.openfuture.co.nz/
Innovation Network - http://veech-network.ryze.com/
Building an Open Future - http://openfuture-network.ryze.com/Private Reply to John Stephen Veitch (new win) |
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