| Subject: | Re: [socialcredit] more on Michael Hudson's harangue of Richard Cook | | Date: | Wednesday, August 22, 2007 21:50:24 (+0000) | | From: | John G Rawson <johngrawson @.......com>
|
| In reply to: | Message 4994 (written by Peter) |
Once again, definitions. I used small "g" for government. If a national
credit authority governs our money supply, obviously it is part of the national
control system, i.e. government. I'll leave the other point alone because it was
only an example of confusion, not really pertinent to the main discussion. My
main point is that immense confusion results when people say the same basic thing
but word it differently because they are coming from different definitions or
understanding of what they mean. And our opponents simply love the fights that
follow when didicated people get upset with each other over very little.
Regards. John R.
From: "Peter" <cymric@xtra.co.nz>
Reply-To: socialcredit@elistas.com
To:
<socialcredit@elistas.com>
Subject: Re: [socialcredit] more on Michael
Hudson's harangue of Richard Cook
Date: Tue, 21 Aug 2007 21:29:21 +1200
You misunderstand my comments John. I am effectively objecting to govt itself
( a cabinet dictatorship) controlling the money supply, not the using it to
replace taxes. The national credit office is supposed to be autonimous of govt,
the basis of my objection to the standard reformers desire and so it could be
argued as to whether the 'office' is in fact a public servant more than a govt
servant, based on who benefits the greatest.
I subscribe to new debt-free money being used to retire taxing. A community
can not rationally borrow from its own credit in order to administer itself. The
effectiveness of the adminstration as assistent facilitor in the functioning of
the full economic-social enterprise is a factor in the credit of the community.
I would rate the un-necessary burdon of this via taxes on Joe Citizen the
equivalent of the consumer paying for the cost of the 'real' economy in the price
of its goods.
Peter.
----- Original Message -----
Sent: Tuesday, August 21, 2007 12:40 PM
Subject: RE: [socialcredit] more on Michael Hudson's harangue of Richard
Cook
Thanks for that.
I think this is a classical example of highly intelligent people stating
basically the same thing, but arguing because they are coming from different
definitions. For example Peter's comment on government controlling money. Social
Credit could not function unless some government agency, e.g. a credit authority,
took control of the issue of money. But of course, what he is objecting to is
Government using new money to replace taxation, which is another matter.
Obviously, all stock exchange transactions involve credit, even if actual money
plays only a small part. We need to distinguish between credit and money, and
probably the best distinction was used by our 1950's Royal Commission. I believe
it is commonplace logic which did not originate with them. Banks create credit
when they authorise borrowing, i.e. grant an overdraft authority. No definition
of money of which I am aware lists this as money. But when a borrower exercises
his right by drawing a cheque (or making any other transfer out of his account)
and the money becomes a credit, a deposit, in someone else's account, money is
created.
This assumes that creditor's deposits with financial institutions are part of
the money supply, and this is used in every definition of the money supply from
M1 up. I doubt if any sane economist would define money as only M0, notes and
coins in circulation, since these days it is a very small fraction of the total
supply and decreasing.
So if money is taken from a credit account and paid into one in overdraft to
the equivalent value or more, that amount of money goes out of existence. The
amount of credit relating to the two accounts may remain the same, if they retain
the same overdraft limits as before. There is no theorem (or hypothesis or
theory) relating to this process. It is a solid demonstrable fact. So if Michael
Hudson confines his comments to credit, he may even be right. But they are
certainly not pertinent to the functioning of the economy which is carried out by
money transfers in the final analysis.
That is not to say, of course, that a contraction of credit will not harm the
economy by causing a contraction of the money supply.
Regards. John R.
From: <william_b_ryan@yahoo.com>
Reply-To: socialcredit@elistas.com
To:
socialcredit@elistas.com
Subject: [socialcredit] more on Michael Hudson's
harangue of Richard Cook
Date: Sun, 19 Aug 2007 23:45:59 -0700 (PDT)
>I invite
commentary on this, what I believe to be a
>Georgist absurdity, from Michael
Hudson's posting to
>gang8 yesterday:
>
>[Hudson] "I view 'the economy' as
divided into two
>sectors. The biggest sector as far as credit is
>concerned
over 99% is the market for financial
>securities, mainly bonds, stocks and
mortgage loans
>and other packaged bank loans. Each day more than an
>entire
year's GNP passes through the New York Clearing
>House and the Chicago Mercantile
Exchange."
>----------------------------------------------
>-----------------------------------------------
>
>Yes,
there's a tremendous amount of churning,
>speculative purchasing and selling of
various forms of
>financial securities. Buying and selling and buying
>and
selling.
>
>But that doesn't mean that "over 99%" of credit
>CREATED in the
overall economy--which the fallacious
>argument infers--results in the
inflationary run-up of
>asset prices as a result of that credit creation, as
>the
Georgist argument alleges.
>
>Almost all of what Hudson is talking about
actually
>offsets (or nets substantially to zero in terms of
>profits and losses so
relatively little cash changes
>hands) day by day in the books of the New
York
>Clearing House, the Chicago Mercantile Exchange,
etc.,
>indicating very little net creation (or for that
>matter contraction) of
credit in the activity, despite
>the huge volume of transactions.
>
>But we would
hope, should we not?, that the long term
>trend is always capital gains, which is
in principle
>indicative of the long term strengthening of the
real
>economy.
>
>
>
>
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Yahoo! in your own image. Join our Network Research Panel today!
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