Money is created when banks lend it
into existence (see article by Thomas Greco on page 19). When a bank provides
you with a $100,000 mortgage, it creates only the principal, which you spend
and which then circulates in the economy. The bank expects you to pay back
$200,000 over the next 20 years, but it doesn't create the second $100,000 -
the interest. Instead, the bank sends you out into the tough world to battle
against everybody else to bring back the second $100,000.
The second $100.000 is indeed repaid out of the
income of the borrower but what is not considered is the origins of the money
which that repayment comes out of. Does it come out of the money the payee
earns for his labour? If so is the persons employer possesed of a large amount
of cash or is he operating his enterprise on a purely cash basis.
I ask this question in all seriousness because it
strikes at the heart of the issue of how pervassive the interest bearing debt
creatingt mechanism is in this year of Our Lord 2005.
Because of the construct of the present 'money'
supply in virtually all countries, (the 300 year old debt mechanism being
the common denominator) there is only two primary sources of the 'money
required to pay back the interest on a bank loan. The first is out of some
store of non debt interest free cash within the financial system or from
the same source as the original debt.
Regards
Trevor Crosbie
Hamilton NZ
----- Original Message -----
Sent: Sunday, April 24, 2005 6:55
AM
Subject: Re: [socialcredit] Replying to
Vic (Deus Ex Machina) -- responding to Trevor
YES! Magazine Summer 1997 Issue: Money:
Print your Own!
Beyond Greed and
Scarcity
by Bernard Lietaer
Few people have worked in and on the money
system in as many different capacities as Bernard Lietaer. He spent five
years at the Central Bank in Belgium, where his first project was the design
and implementation of the single European currency system. He was president
of Belgium's Electronic Payment System, and has developed technologies for
multinational corporations to use in managing multiple currency
environments.
He has helped developing countries improve
their hard currency earnings and taught international finance at the
University of Louvain, in his native Belgium.
Bernard Lietaer was also the general manager
and currency trader for one of the largest and most successful offshore
currency funds.
He is currently a fellow at the Center for
Sustainable Resources at the University of California at Berkeley.
YES!editor Sarah van Gelder talked to Bernard
about the possibilities for a new kind of currency better suited to building
community and sustainability. He can be reached to discuss this topic via an
Internet conference at: http://www.transaction.net/money/
SARAH : Why do you put so much hope into the
development of alternative currencies?
BERNARD : Money is like an iron ring we've put
through our noses. We've forgotten that we designed it, and it's now leading
us around. I think it's time to figure out where we want to go - in my
opinion toward sustainability and community - and then design a money system
that gets us there.
SARAH : So you would say that the design of
money is actually at the root of much else that happens, or doesn't happen,
in society?
BERNARD : That's right. While economic
textbooks claim that people and corporations are competing for markets and
resources, I claim that in reality they are competing for money - using
markets and resources to do so. So designing new money systems really
amounts to redesigning the target that orients much human
effort.
Furthermore, I believe that greed and
competition are not a result of immutable human temperament; I have come to
the conclusion that greed and fear of scarcity are in fact being
continuously created and amplified as a direct result of the kind of money
we are using.
For example, we can produce more than enough food to feed
everybody, and there is definitely enough work for everybody in the world,
but there is clearly not enough money to pay for it all. The scarcity is in
our national currencies. In fact, the job of central banks is to create and
maintain that currency scarcity. The direct consequence is that we have to
fight with each other in order to survive.
Money is created when banks lend
it into existence (see article by Thomas Greco on page 19). When a bank
provides you with a $100,000 mortgage, it creates only the principal, which
you spend and which then circulates in the economy. The bank expects you to
pay back $200,000 over the next 20 years, but it doesn't create the second
$100,000 - the interest. Instead, the bank sends you out into the tough
world to battle against everybody else to bring back the second
$100,000.
SARAH : So some people have to
lose in order for others to win? Some have to default on their loan in order
for others to get the money needed to pay off that interest?
BERNARD : That's right. All the
banks are doing the same thing when they lend money into existence. That is
why the decisions made by central banks, like the Federal Reserve in the US,
are so important - increased interest costs automatically determine a larger
proportion of necessary bankruptcies.
So when the bank verifies your
"creditworthiness," it is really checking whether you are capable of
competing and winning against other players - able to extract the second
$100,000 that was never created. And if you fail in that game, you lose your
house or whatever other collateral you had to put up.
SARAH : That also influences the unemployment
rate.
BERNARD : It's certainly a major factor, but
there's more to it. Information technologies increasingly allow us to attain
very good economic growth without increases in employment. I believe we're
seeing one of the last job-driven affluent periods in the US right now. As
Jeremy Rifkin argues in his book, The End of Work, jobs are basically not
going to be there anymore, even in "good times."
A study done by The International Metalworkers
Federation in Geneva predicts that within the next 30 years, 2 or 3 percent
of the world's population will be able to produce everything we need on the
planet. Even if they're off by a factor of 10, we'd still have a question of
what 80 percent of humanity will do.
My forecast is that local currencies will be a
major tool for social design in the 21st century, if for no other reasons
than employment. I don't claim that these local currencies will or should
replace national currencies; that is why I call them "complementary"
currencies. The national, competition-generating currencies will still have
a role in the competitive global market. I believe, however, that
complementary local currencies are a lot better suited to developing
cooperative, local economies.
.....
..
----- Original Message -----
Sent: Friday, April 22, 2005 4:50
PM
Subject: RE: [socialcredit] Replying to Vic
(Deus Ex Machina) -- responding to Trevor
> Hi Trevor, Congratulations on responding to Deus with such a
concise and
> accurate description of the 3 century development of
what has become the
> world's biggest, semi legal scam. Like
yourself, I cannot understand how
> any fellow human being who
graduated from primary school with ticks for the
> three "R's", and
who has access to the Internet and presumably a local
> library, can
really believe that the claimed,repeated lending of a deposit
> over
and over again, to different borrowers at the same time; is not a
>
charade for the dumb proletariat, to protect politicians in bed with
the
> banks and TNC's from a public explosion of
indignation.....Reminds one of
> Lincoln's very relevant quote that if
the public really found out what the
> banks were doing to the
country, there's be a revolution before breakfast.
> (In colonial
jargon 3 R's = Reading, Riting & Rithmatic.)
>
> While out
of good taste, I have not mentioned the alternative option that
>
Deus's claimed refusal to accept that banks actually do create a
money
> substitute called credit (really interest bearing debt) out of
nothing and
> then hire it out to the country at all levels from the
state downwards, may
> not be so much an inability to understand,
as a desire to metaphorically
> muddy the water to suit a quite
different objective, but most readers will
> on their own initiative
take a cool, steady look in that direction.
>
> Sorry for
having been provoked into being so blunt.
>
>
Don Bethune of Godzone
>
###############################################
>
>
>
> -----Original Message-----
> From: Trevor Crosbie
[mailto:tamac@xtra.co.nz]
> Sent: Friday, 22 April 2005 20:36
>
To: socialcredit@elistas.com
>
Subject: Re: [socialcredit] Replying to Vic (Deus Ex Machina) --
>
responding to Trevor
>
>
> I am truly amazed at your
lack of understanding of the basic concept of debt
> creation -
without extensively revisiting the history of where money comes
> from
and where it goes the basic fact is this:
> Over three hundred years
ago the concept used by the goldsmiths to 'create'
> receipts on the
gold they held on behalf of their clients was extended or
>
transferred or adopted for use as the foundation for what we now call
'the
> money supply'
> It comprised the notes and coins
'manufactured' by the treasury and the
> 'credit' issued by way of
loans through the banking system. The mechanism
> used to create the
credit which the banks lent out to approved clients was
> controlled
and operated by private interests as a profit making enterprise.
>
Today that profit making enterprise has spread its influence around
the
> world and dominates and restricts the ability of representative
governments
> to fullfill the needs and expectations of those who vote
them in to that
> role. Douglas correctly identified the money power
as the root cause of the
> issues he raised in most of the books and
pamphlets he wrote. He
> unfortunately in later years linked the
problems of money (debt) to some
> form of Jewish conspiracy when in
actual fact the involvement of prominent
> Jewish families in banging
and finance stemmed from the fickle finger of
> opportunistic fate in
similar vein to the adoption of the a debt based
> mechanism as the
foundation of economic activity, originally in England and
> now
around the globe.
> Until the debt based foundation of national
economies is changed there can
> be nothing as certain as the
prediction that the same issues that have made
> media headlines for
the past 50 years will continue to make them for the
> next 5 decades.
Debating the effects of the problem without recognizing and
>
rectifying (reforming) the cause is the history of politics for centuries
-
> its time for a real change.
> Regards
> Trevor
Crosbie
> Hamilton NZ
> p.s. From Jessop - Another thing,
the way you put it in your e-mail,
> Trevor, makes it sound as if the
bank claims for itself the whole debt, ie.,
> that if the bank
advances you credit of, say, $100,000, when you repay it
> the bank is
$100,000 richer than it was before the transaction. How do you
>
arrive at that conclusion?
> TC Replies - The example I use is a bank
created debt of 100k - over the
> life of the loan the capital is
repayed plus the interest. That interest can
> be as much as 4 times
the original debt. The interest acrues to the owners
> of the
mechanism which created the debt. If it is a government who borrows
>
that 'money' from the bank who operates the debt creation mechanism in
order
> to build a road or a hospital or a school or a railway or
anything that can
> be seen as something individuals in society as
individuals cannot build for
> themselves, then the people, through
the taxes and charges imposed by
> 'their' government will pay once
twice or three times over for 'their'
> infrastructure rather than
just once. What is more inflationary Jessop,
> paying 100k for a
sewerage scheme or paying 2,3or 400k for it?
> TC
>
>
----- Original Message -----
> From: "Jessop Sutton" <sutton@kingsley.co.za>
>
To: <socialcredit@elistas.com>
> Sent: Thursday, April 21, 2005 4:55 AM
> Subject:
Re: [socialcredit] Replying to Vic (Deus Ex Machina) -- responding
>
to Trevor
>
>
> > Responding to Trevor.
>
>
> > Trevor, you wrote:-
> > "The only way forward is
to back interest bearing debt out of the system
> > by
> >
using the power of credit, controlled by the people, to provide
essential
> > infratstructure, free of debt, for future generations
as a starting point
> > for the introduction of a Social Credit
economy."
> >
> > I see Bill Ryan has replied to
this.
> > =============================
> >
> >
Trevor, you also says:-
> > "That process is driven by the need to
service an ever growing level of
> > international, national,
regional, company and personal debt - all owed to
> > the owner
operators of the debt mechanism."
> >
> > This often
puzzles me. Why is interest charged by a banker for his
> >
services
> > seen as anything different than the 'imple markup
applied by any industry
> > to
> > provide a dividend to
it's shareholders? Are the holders of shares in
> > banks
>
> less entitled to a return of their investment than are the shareholders
on
> > one of the multi-national oil corporations? Or even, say, of
the movie and
> > entertainment industries which provide a service
to those who want to make
> > use of it, and a good return for
those invested in the industry?
> >
> > Here's a quote
very much to the point from a recent e-mail by our Margeret
> >
Legum, a lobbyist for a better deal for the poor:-
> > "If neither
the world's consumers nor its farmers are doing well out of
> >
agriculture, who is benefiting? It is our old friends the
multinational
> > corporations and supermarkets. Mergers,
acquisitions and interlinking have
> > reduced their number to
about five groups that control most of the world's
> > staple food
economy from supplying seed to buying produce, to processing
> >
and
> > selling. Since they are virtual monopolies they have
a strong influence
> > over
> > prices. They are
exceptionally profitable." [SANE Views Vol.5, No.8, 19
> >
April
> > 2005.]
> >
> > Are these multinationals
more entitled to reward their investers than are
> > the
>
> banks? Bill Ryan not so long ago made the point excellently on this
list
> > that
> > interest is merely the banks charge for
its services.
> > =============
> >
> > Another
thing, the way you put it in your e-mail, Trevor, makes it sound
>
> as
> > if the bank claims for itself the whole debt, ie., that
if the bank
> > advances
> > you credit of, say, $100,000,
when you repay it the bank is $100,000
> > richer
> > than
it was before the transaction. How do you arrive at that conclusion?
>
>
> > Jessop.
>
>
>
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