|Subject:||[socialcredit] Re: [chdouglas] Re: I await your answers to my questions (was: Re: Public-spirited Banking (was: Re: The Abolition of Interest on Loans))|
|Date:||Friday, March 21, 2008 08:40:53 (-0700)|
|From:||Peter Hogwood <p_t_hogwood @.....com>
But this reply of yours does not respond to what I had
asked. I had asked, in effect, why cannot profit be
calculated in a non-creditary system? I proved that it
You did not answer the question I had asked, while I
demonstrated that what you claimed - namely that
profit cannot be calculated in a non-creditary system
- was false. Please answer the question I had asked!
[Reply] No, you didn't prove that. You gave a single
isolated example of where a chariot that cost ten
denarii to produce was sold for twelve denarii.
Isolated examples are always possible in exception to
the general rule.
Start with the assumption of a fixed number of gold
coins that support the entire volume of trade and
commerce. If the population is increasing and the
number of firms and transactions are increasing, it
has to be the case that, as a matter of statistics and
averages, that each individual firm is always
receiving back fewer gold coins than it is spending,
that, again as a matter of statistics and averages,
that each individual firm is booking continuously a
loss by any conceivable system of accounting.
You could imagine that there is a gold mining industry
that is supplying gold coins to the community. It
spends gold coins for goods and services from the
remainder of the community, and loans gold coins to
non-mining firms so they can conduct their business.
It follows that trade and commerce would be limited to
the number of gold coins that the mining industry
could supply, regardless of the real needs of trade
and commerce in an otherwise growing economy. The
economy would be severely constrained by the
limitations of finance.
>> So what? Where exactly does the fractional reserve
system - or anything like it - enter into your
> [Reply]: Because fractional reserve banking allows
the flux of "tickets" from firms through their
spending to increase with the expanding needs of trade
Sure it does, but the same thing can be done without
fractional reserve banking - by the government of a
nation simply increasing the nation's money supply
commensurate with the expanding needs of the nation's
trade and commerce. Why should the BANKS, which are
often multi-national, and are NOT answerable to the
citizens of any nation, be allowed to increase the
flux of these "tickets", as you call them? Why should
not only a government answerable to the citizens be
allowed to do that?
[Reply] In our system all firms are, again
statistically speaking, deficit spending in the
normally growing economy, yet are booking a profit
through the rules and conventions of double entry
accounting, with accommodation by the banks. In your
proposed alternative, only the government would be
allowed to deficit spend, which was essentially the
Soviet system. It was also a system where the
calculation of profit was impossible, which directed
production through elaborate Leontiefian-like
input-output tables. Whereas ours is entrepreneurial
driven, with informational feedback from final
consumers through free markets.
It says nothing about justices of the peace having
jurisdiction over any other cases. (Or are you
claiming it does? If so, where does it say anything
If what the articles says is true, then Justice
Mahoney had no jurisdiction over the case involving
[Reply] The court did indeed have jurisdiction over
the underlying matter brought by the bank. Mahoney
went far beyond his jurisdiction in pontificating on
federal law. The quotation from the Minnesota law
library was not all inclusive but merely an excerpt.
Appeal was brought on the grounds that Mahoney had
exceeded his jurisdiction in his ruling and decree.
Did you READ the page referenced to "Zurn v.
Northwestern National Bank", at:
...? It says nothing about the case of the First
National Bank of Montgomery Jerome Daly vs. Jerome
Nor does the material referenced for "Daly v. Savage
State Bank", which can be found at:
... mention anything about the First National Bank of
Thus it is obviously deceptive, to say the very least,
to claim that the case of First National Bank of
Montgomery Jerome Daly vs. Jerome Daly were declared a
[Reply] Again, you are obviously not a lawyer and
know nothing about legal procedure. Daly was involved
in several similar foreclosures in which he was
involved either as a defendant or lawyer representing
others, from Mahoney's court, that were grouped
together by the appellate courts.
"Ultimately, the decision of the justice of the peace
court was nullified and Daly was subsequently
Yes, I have heard this specious argument before, many
times. It's still unconstitutional, though, isn't it,
for anyone other than Congress to issue US money. The
US Constitution says, "Congress shall have the power
... To coin Money, [and] regulate the Value thereof."
Note the word "Money". The word is NOT "legal tender".
[Reply] Notice that the constitution does not say
EXCLUSIVE power. Please learn to read. And note that
the Federal Reserve is a creature of Congressional
legislation. Banks are licensed by state and federal
If I were to issue money, in any form, even electronic
form, and call that money "US dollars", I would be
considered a counterfeiter, would I not? And I would
be called a counterfeiter even if I were to back up
every cent of the electronic money I issued with REAL
money kept at my home, which anyone holding my
electronic money could have on demand. Yet banks issue
such electronic money every day! What's the difference
between me and the bank, then?
[Reply] One difference is that the banks are licensed
by the state or federal governments to be in the
business of banking. You are not.
That is not altogether true. People aren't allowed to
issue a nation's money without being called
[Reply] People who are not licensed as banks might be
But by calling the money they issue "US dollars", the
banks are CLEARLY engaged in counterfeiting ... or at
the very least in a scam (i.e, a deception, a
dishonest scheme and a fraud perpetrated upon the
general public, who indeed are caused to believe that
the money issued by the banks are US dollars).
[Reply] You have clearly never read your deposit
contract with your bank. Please point to even a
single statement in that contract that is deceptive.
Also, perhaps you never noticed that banks do not call
their deposits "US dollars" but "dollars," which
represent a general consensus as to value. I can
create a limited form of money by tendering a
promissory note denominated in dollars. It is limited
in the sense that it is not as generally recognizable
as are bank deposits, and therefore could not
accommodate trade and commerce to the same extent.
--- Ardeshir Mehta <email@example.com> wrote:
> On 21-Mar-08, at 2:29 AM, Peter Hogwood wrote:
> > Ardeshir, my replies are inserted [Reply] below:-
> >>> It has to do with accounting and numbers. The
> >>> question is how could profit be calculated in a
> >>> system? It can't be in a non-creditary system,
> which is the point.
> >> Why ever not?
> >> Suppose there were only gold coins in
> circulation, and no bank
> >> notes at all, like in Roman times. A manufacturer
> of, say,
> >> chariots could use gold coins to buy everything
> he needs: his
> >> lumber, his hardware (axles, nails, and so on),
> the firewood for
> >> his fires, his tools, etc.. Suppose he makes
> chariots and sells
> >> them. Suppose it costs him ten denarii per
> chariot to buy
> >> everything he needs to make the chariots, and he
> is able to sell
> >> each chariot for twelve denarii. Then his profit
> would be
> >> calculated as being two denarii per chariot,
> wouldn't it?
> >> If not, why not? ( Note that no credit is
> involved in this
> >> calculation. )
> >>> A commodity-like money operating in accordance
> to the quantity
> >>> theory just wouldn't work. There is no possible
> way for profit
> >>> and loss to be accurately calculated in such a
> >> Why not, given the example I just gave above?
> > [Reply]: Gold is in relatively fixed quantity. A
> commodity money
> > based on gold could not expand to accommodate
> increasing trade.
> > With increasing transactions involving more and
> more people and
> > firms, as a statistical matter individual firms
> could not possibly
> > be receiving back in reflux to their spending more
> than they are
> > spending, because their spending is accumulating
> into more and more
> > balances which are in subtrahend to system flow.
> The reflux to
> > individual firms in sales would always be falling
> in respect to
> > their spending, an impossible condition involving
> perpetual loss in
> > terms of any conceivable system of accounting. The
> > civilization was precluded from developing a mass
> > economy because double entry accounting had yet to
> be invented, and
> > creditary instutions like modern banks that
> accommodate expanding
> > trade could therefore not exist. For this reason
> Roman civilization
> > was doomed to subsist on slavery and plunder.
> But this reply of yours does not respond to what I
> had asked. I had
> asked, in effect, why cannot profit be calculated in
> a non-creditary
> system? I proved that it CAN be.
> You did not answer the question I had asked, while I
> that what you claimed - namely that profit cannot be
> calculated in a
> non-creditary system - was false. Please answer the
> question I had
> >>> Basic model of the modern economy:
> >>> Firms pay out, in return for goods and services
> >>> generally recognizable creditary instruments, or
> "tickets," which
> >>> they redeem over their sales counters for
> produced goods and
> >>> services. Inasmuch as tickets printed by the
> individual firms
> >>> themselves would not be generally recognizable,
> and therefore
> >>> would not be tradeable, banks accommodate the
> process by
> >>> exchanging their generally recognizable
> "tickets" in the form of
> >>> deposits for the individual "tickets" of the
> firms, a service for
> >>> which they charge a fee called interest,
> inasmuch as it is a
> >>> function of time. These "tickets" are contracts
> involving credit
> >>> and debt, pure and simple.
> >> So what? Where exactly does the fractional
> reserve system - or
> >> anything like it - enter into your argument
> > [Reply]: Because fractional reserve banking allows
> the flux of
> > "tickets" from firms through their spending to
> increase with the
> > expanding needs of trade and commerce.
> Sure it does, but the same thing can be done without
> reserve banking - by the government of a nation
> simply increasing the
> nation's money supply commensurate with the
> expanding needs of the
> nation's trade and commerce. Why should the BANKS,
> which are often
> multi-national, and are NOT answerable to the
> citizens of any nation,
> be allowed to increase the flux of these "tickets",
> as you call them?
> Why should not only a government answerable to the
> citizens be
> allowed to do that?
> >> Is it conceivable to you that the bank was
> seeking possession of a
> >> house worth less than $100? If the house was
> worth more, then a
> >> Justice of the Peace would, according to the
> first-quoted passage,
> >> have no jurisdiction over the case.
> > [Reply]: You are clearly not a lawyer and know
> nothing about the
> > law. I would even question your your ability to
> read a simple
> > declarative sentence.
> What evidence do you have for making such
> > The $100 limitation has to do with civil disputes
> between parties
> > involving monetary claims, or minor criminal
> matters. JPs are
> > involved in approving various writs and warrants
> that do not
> > involve monetary claims. The claim in this case
> was not for money
> > but foreclosure and the sheriff's sale of
> collateral, something
> > apparently handled by JP courts in Minnesota.
> The article you quoted says,
> The 1967/1968 Minnesota Legislative Manual states:
> "Justices of the peace are elected for two-year
> terms in townships
> and in cities and villages which do not have
> municipal courts.
> Justices of the peace have jurisdiction over actions
> arising within a
> county when the amount involved does not exceed $100
> for civil cases,
> and when the punishment or fine does not exceed $100
> or three months'
> imprisonment in criminal cases."
> [END QUOTE]
> It says nothing about justices of the peace having
> jurisdiction over
> any other cases. (Or are you claiming it does? If
> so, where does it
> say anything like that?)
> If what the articles says is true, then Justice
> Mahoney had no
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