| Subject: | [socialcredit] Re: the goldsmith "fraud" story | | Date: | Monday, June 16, 2008 10:37:24 (-0700) | | From: | william_b_ryan <william_b_ryan @.....com>
|
Richard, I am familiar with these arguments. They are carefully though
deceptively crafted to support the claim of fraud. For example, the clever usage
of the term "deposit receipts." In modern usage the term refers to the proof
from your bank that you made a deposit with your bank in the amount indicated.
That's all it is. It is non-negotiable and does not circulate in trade. In the
mythical goldsmith fraud story the deposit receipts were circulated from person
to person in trade. In actuality, as demonstrated in my last posting, it appears
that the goldsmiths issued deposit receipts in something similar to the modern
sense but also issued promissory notes that circulated from person to person in
trade. A promissory note is nothing more than a contract for future performance.
The ability to contract is a unique human characteristic and is something that
separates us from the animals. Modern banknotes and transferable deposits
descended from
the goldsmith promissory notes which were their prototype. The goldsmith
practice seems to be fraudulent only to those unfamiliar with the process
involved.
-
"...as banks issue more ownership claims but the amount of physical matter
remains the same, these ownership claims cannot be but fraudulent."
--------------------------------------------------------
The following is a statement from the "new economics" of the 1920s and 1930s.
Understandably it doesn't mention consumer credit since it was mostly a post
World War 2 development.
-
"[1] Loan credit arises from the private contract between banker and
entrepreneur, [2] creating a generalized claim against the community as a whole,
[3] enabling the entrepreneur to organize the factors of production into their
most efficient combination, [4] as ultimately judged by the consumer through the
democracy of the market, [5] the feedback mechanism being profit and loss.
"[6] Investment is the process of improving the quantity and quality of
capital; [7] it is facilitated by credit, [8] and driven by entrepreneurial
initiative, [9] the discovery of resources, and [10] the invention of technology.
"[11] Saving is the process of acquiring beneficial ownership claims against
capital, [12] which generate increasing income in the form of dividends or their
functional equivalent, [13] as capital accumulates."
-
Assertions 1-3 contradict your assertion that "amount of physical matter remains
the same." Loan credit is an essential component of the dynamic process that
increases the quantity of consumable wealth. Simply because most people do not
even today understand the process does not make it fraudulent.
Not all entrepreneurial projects succeed. Those that fail contribute to the
phenomenon of inflation. The concept is statistical, meaning that on balance
consumable wealth is increasing.
Bill Ryan
------------------original message----------------
Dear William,
Banks act as the accountants of the economy and the public assumes honest
accounts. This means that if there is a deposit in the banking system, it is
assumed by the public that it was actually deposited by somebody. In actual fact,
banks create deposits out of nothing and issue deposit receipts (or the modern
form of them) when they grant so-called loans. But in actual fact these deposits
appear without any money having been deposited. This seems pretty fraudulent, and
there are many scholars who argue that it is fraudulent.
Another argument is the comparison with the physical reality - as banks issue
more ownership claims but the amount of physical matter remains the same, these
ownership claims cannot be but fraudulent. There are academic papers on that as
well.
I don't see why you are averse to the argument. Do let me know.
Regards,
Richard
|
Re: the goldsmith 
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