| Subject: | [socialcredit] Re: the disassembly of Marc Gauvin | | Date: | Saturday, May 13, 2006 09:59:30 (-0700) | | From: | William B. Ryan <w_b_ryan @.....com>
|
"Mr. Ryan thank you for your reply and pointing out
that my logic is correct, although I had established
that it may be required to have other loans to pay the
interest, given that the loan on its own and according
to your own words, cannot ever satisfy the demand of
both interest and principal. This was anticipated,
the question that remains is what are the terms of all
sources of money that can satisfy the example in the
real world scenario."
------------------------------------------------------------
But Marc, by no means did I say that your logic is
correct. It is incorrect for it depends on a patently
false assumption. You would have to find some
parallel universe, perhaps, where gravity does not
attract but repel. In that universe your argument
might have some validity.
-
".....you will find that at the end there will always
be a last outstanding amount of principal that is
still generating new interest (remember interest is a
function of time). This interest will require either
offshore money or a new loan to permit canceling all
remaining interest plus principal..."
------------------------------------------------------------
There is no "remaining" interest in the hypothetical
equilibrium condition of recurring steady state that I
related to you earlier:
"In this example, the total principal from that point
onward from both recurring loans always remains at 10,
ad infinitum. The banker being paid 0.5 every six
months for the financial services that he renders to
the community that enable it to be a going economic
concern, which he continually spends back into the
community."
If, at the point of renewal of either recurring loan,
the loan is not in fact renewed, the banker will
continue to spend the interest received on that loan
back into the economy during the next six months,
enabling the other loan to be repaid in its totality,
including interest. [see note below]
Remember that the money deriving from the other loan
remains in circulation. That plus the interest just
received will exactly equal the principal plus
interest due in six months.
-
Note: If the augment is contingent on the banker not
spending the interest he is receiving back into the
economy, the argument is an underconsumption argument
that has nothing to do with interest per se. It would
equally pertain to any income received from any source
by any person for any purpose whatsoever, in terms of
relating purchasing power to the costs of production.
But the underconsumption argument is itself
fallacious, as I have demonstrated elsewhere. Though
it is fallacious it nevertheless reflects a greater
comprehension of reality than that held by the
stereotypic monetary crank, narrowly focused that he
is.
The correct argument is supplied by recourse to the
A+B theorem.
--- Marc Gauvin <gauvin@wanadoo.es> wrote:
Date: Saturday, May 13, 2006
From: Marc Gauvin <gauvin@wanadoo.es>
All, Mr. Ryan,
Mr. Ryan thank you for your reply and pointing out
that my logic is correct, although I had established
that it may be required to have other loans to pay the
interest, given that the loan on its own and according
to your own words, cannot ever satisfy the demand of
both interest and principal. This was anticipated,
the question that remains is what are the terms of all
sources of money that can satisfy the example in the
real world scenario.
My point is that if all other monies be they offshore
earnings or subsequent/simultaneous loans required to
satisfy the example given all bear their interest at
their origin,m then aggrogate case is the same as my
singular example.
I invite you to follow in more detail my arguments in
the following:
Mr. Ryan wrote:
Yes, if you start from that patently
> false assumption you will derive the conclusion you
> reach as a matter of logic.
So Mr. Ryan agrees that my logic is correct but that
my premises are wrong. He further writes that:
> The false assumption is that the money supply can be
> reasonably modeled as the "principal" on a single
> recurring loan.
I had already anticipate this when I wrote:
.....you will find that at the end there will always
be a last outstanding amount of principal that is
still generating new interest (remember interest is a
function of time). This interest will require either
offshore money or a new loan to permit cancelling all
remaining interest plus principal...
And
........Finally, if you don't pay the principal you
don't get out of debt which is why I claim that if you
produce the table you will find that unless there is
off shore input or the bank issues a new loan, both
interest and principal CANNOT be completely paid....
So, my question remains, is it required in my example
that either an extra loan be created or offshore
income be obtained?
Now, depending on the answer to this question, we may
or may not need to determine if there is indeed a
source of money that is consistently available to
guaranty that at all times there is always enough
money in circulation to pay both interest and
principal. This requirement only is required if the
principal requires replenishing in order to satisfy
the demand for both interest and principal.
Since Mr. Ryan says that my logic is correct but the
scenario proposed is unrealistic because it assumes
that the only money available is the principal, the
question that remains to put this issue to rest is.
What are the interest free sources of money that can
compensate for the interest payments demanded from
principal put into circulation through interest
bearing loans?
Best regards,
Marc
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