In-Reply-To: <20050822162438.44905.qmail@web60515.mail.yahoo.com>
Whoever this apologist for the usurious fractional reserve banking system
is, they should be shown up for what they are, the vassals of the slave
masters.
Firstly the creditworthiness that the bankers are monetising is not their
own creditworthiness, but the creditworthiness of the consumer.
This is their first usurpation.
Secondly they take to themselves the function that should be in the hands
of the community themselves. That is the creation and circulation of a
medium of exchange.
That is their second usurpation.
Thirdly. In creating the capital sum they fail to create also the means to
pay the usury. This leads inevitably to the necessity for there to be
further borrowers to enable that first sum of usury to be repaid. The
result is inevitable unrepayable indebtedness.
This is their Third usurpation.
Ken.
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Date: Mon, 22 Aug 2005 09:24:38 -0700 (PDT)
From: "William B. Ryan" <w_b_ryan@yahoo.com>
To: socialcredit@elistas.com, lwside1@yahoogroups.com,
cogexec@cog.kent.edu
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Subject: [socialcredit] Flux - Efflux - Reflux
X-Envelope-To: kenpalmerton@cixcouk.cix.co.uk
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I'll respond once again to this rather ignorant flat
earth theory with some brief comments inserted into
the text below:-
-----------------------------
"However the word 'FEE' is not the appropriate one in
that question. IT should be asking 'why are you
continuing to pay them INTEREST'. This is very
different from a fee."
-------------------------------
---------------------------------
[comment] Not calling fees interest allows financial
institutions that effectively charge interest rates
several times what conventional banks charge on loans
to deceptively claim they are "interest free." The
example that immediately comes to mind is Per
Almgren's JAG bank.
---------
"I agree with you that the creating of credit is
effectively costless, and to charge interest on top of
fees is worse than gross violation by usury against
someone. Why? Because the credit wasn't that of the
banks that they forewent in order to satisfy the need
of the customer. The credit that was monetarised was
that of the borrower."
-------------------------------
---------------------------------
[comment] Factually incorrect. The banker exchanges
his personal credit instrument in the form of a
deposit liability for the borrower's promissory note.
The banker's deposit liability is generally accepted
because it is known throughout the community, due to
his monopoly, whereas the borrower's is not. That
service is not costless but provides a net benefit to
the community through cooperative association.
Therefore, the monopoly is what we would call natural
and is to be encouraged, with appropriate public
oversight.
---------
"So in my view the debt banking system is worse than
usury on this count and further still on the basis of
the quote from M. Levi the French mathematician by
edsa that all wealth of the world will be owned
eventually by the banks. This again makes the word
usury total inadequate to address the crime."
-------------------------------
---------------------------------
[comment] The exponential formula is irrelevant to the
concept of interest in the modern creditary economy.
The modern perspective of the macroeconomy is that of
three fundamental sectors: Firms, Banks and Consumers
-- each in continuing interaction with the others.
In juxtaposition to Consumers is the nexus of Firms
and Banks, which "efflux" payments to Consumers in the
form of salaries, wages and dividends. Firms in their
accommodating nexus with Banks sell goods and services
to Consumers, the purchasing of which by Consumers
constituting the creditary "reflux" back to the nexus
in amortization to their costs of production as a
matter of accounting -- the "ticket" metaphor.
This is as far as the standard model goes, which
Douglas extends a bit further (though historically
more than a half-century before the now standard model
was recognized by the Post Keynesians) to fit
observable reality, in making it dynamic.
The conventions of double entry accounting -- in the
macroeconomic sense in which we are using it -- assume
that the "reflux" is sufficient to amortize the costs
of production plus profit, which requires a static
premise -- the "flaw" to which Douglas referred.
Interest is simply the name for the Banks' share of
profit with Firms.
Profit does not represent an extraction from the
stream of commerce inasmuch as it represents by
accounting definition the fund from which dividends
are paid and investments made -- or capital as defined
by accounting.
In the Douglas refinement to the standard model, there
is "flux," "efflux" and "reflux," where the flux
represents the totality of the accounted for costs of
production, and the efflux represents payments to
Consumers and is therefore in accounting subset to the
costs of production -- designated in mathematical
nomenclature as A+B and A, respectively.
Because A+B does not necessarily equal the reflux from
A, there is the possibility that the reflux from A
will not completely amortize A+B, evidenced by
exponentially increasing debt (in respect to the rate
of production of consummable production) that
inevitably at some point breaks into crisis. (The
Post Keynesians have reached this stage in the
argument in their stress on "uncertainty.")
If the ratio of B is increasing to A, certainly it
cannot equal -- ever -- without continuous conscious
intervention.
That is to say, the Dividend and Discount.
-
------original message------
Subject: Re: [socialcredit] Timely articles about the
usuryfree community currency movement in a national,
Financial magazine in Canada ...
Date: August 22, 2005 11:28:53 (+0200)
From: cymric <cymric@xtra.co.nz>
Howdy Janos,
I appreciate what you were getting at and I agree.
However the word "FEE" is not the appropriate one in
that question. IT should be asking 'why are you
continuing to pay them INTEREST'. This is very
different from a fee. If banks couldnt create money
they would still play a vital role in the economy
which is similar to an accountant in that they keep
accounts for everyone. This is where the "FEE" comes
in. Its their professional fee as the accountant is
entitled to. This fee includes their overheads.
I agree with you that the creating of credit is
effectively costless, and to charge interest on top of
fees is vorse than gross violation by usury against
someone. Why? Because the credit wasnt that of the
banks that they forewent in order to satisfy the need
of the customer. The credit that was monetarised was
that of the borrower. So in my view the debt banking
system is worse than usury on this count and further
still on the basis of the quote from M. Levi the
French mathematician by edsa that all wealth of the
world will be owned eventually by the banks. This
again makes the word usury total inadiquate to address
the crime.
I agree with you that 'interest' is related to savings
being re-invested by the bank for the saver. And the
charge of interest on money banks create by the touch
of a key is 'usury' (and worse in fact). But its
interesting in terms of the definition of usury (
Fifth Lateran) that since the savings of a saver are
not immediately needed, then they shouldnt charge the
banks interest for their use of the money.
I would like to correct a mistake that has arisen in
this discussion: Savings are a liablity to banks
because they are bound to repay and with interest.
Deposits (created loans) are an asset to the bank
because it represents money with interest owing to the
bank.
I was pleased to see the title of the article posted
by W.Ryan - The Red Herring of Usury. I think it is a
bit of a red herring. I think it would be more
interesting to talk about how 'savings' might change
in a Social Credit society and secondly the other
matter of created money- the monetarisation of the
individual citizens credit. If it is interest free
then what is the impact going to be on the money
supply and would it need to be regulated? W. Ryan
might like to start the ball rolling for us on these.
Peter H
-
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