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Hi John,
I think many socialists, by their nature, are the type who
want to be "their brother's keeper". Whether the "brother" appreciates, or
even wants, their "keeping". Which he may well
not. Especially if that "keeping" involves the
restrictions on his "freedom" such "keepings" always seem to entail.
I always thought Douglas's description of
socialism was quite appropriate ~ "monopoly state capitalism with control
by finance". Also his observation that for all their desire to
're-distribute' wealth equally, we never seem to hear the socialist call
for an equal re-distribution of the National Debt.
For if the country is said to be that much the 'poorer' by
owing it, surely those to whom it is owed must be that much the 'richer' by
the same amount.
But I think you're right. Though maybe a shade
optimistic about the number of Conservatives, (or anybody else), who
understand how banking really works.
I believe that is one of the major challenges we've got to
overcome, along with vastly broadening an understanding of how 'double-entry'
accounting really works. Both our own, and the public's, and those we
elect to office to represent us.
There is a real need for a comprehensive,
understandable, modern 'primer' on both these subjects. And the
relationship of one to the other.
Textbooks I've seen on Accounting are good at
showing 'how' to do it, in regards to the 'bookkeeping' involved.
But sadly lacking on the history of the subject, the 'why' many things
are done as they are done, and are generally limited to just what the 'books'
show in regards to one Firm.
There's nothing that takes the subject beyond that, to the
economy as a whole.
An enormous amount of needless argument could be avoided
if such a work could be produced. (I would say, in going back and reading
many of Bill Ryan's posts, that he's already written a great deal of what such a
work should include). Without something like that, we're going to continue
to 'dance in the dark', and spend more time arguing amongst ourselves
fruitlessly than in achieving any meaningful progress.
Regards,
Joe
----- Original Message -----
Sent: Thursday, November 27, 2008 12:58
PM
Subject: RE: [socialcredit] Finance:
Credit "Crisis" and "Depression"
Greetings Joe. I doubt if one Conservative in fifty
understands how the banks work either. But yes, factional strife among
monetary reformers helped the socialists to throw out the while
thing.
There are times when I wonder if Marx wasn't set up to draw
attention away from financial problems. The whole approach of writing this
down as just a sideline to the big nasty employer-oppressors is quite
weird.
Of course, when discussing socialism it is important to define what
it is: state ownership of the means of production, distribution and exchange.
Many people project it as just having a conscience and care for people.
Most "socialist" parties these days would have been considered only slightly
liberal in a past generation; ours in the '80's was hard
neo-conservative.
Regards.
John R.
From: thomsonhiyu@shaw.ca
To: socialcredit@elistas.com
Date: Wed, 26 Nov
2008 20:42:20 -0800
Subject: Re: [socialcredit] Finance: Credit "Crisis"
and "Depression"
Hi John,
I believe Social Credit once had considerable
support amongst members of the British Labour Party, (in the years right after
World War One). I think it's quite clear now that the 'bright
lights' of that Party never really understood it, though, and probably
wouldn't have agreed with it if they had.
I wouldn't doubt the same could be said for the NZ
"Socreds" who backed your first Labour government, and substituted 'deficit
financing' for Douglas's "Proposals" to try to get you out of the Slump.
Douglas and Orage tried to get British Labour
Party support for their "Plan for the Coal-mining Industry", which would have
been a 'social credit' alternative to the 'socialism' those then
prominent as leaders in that Party wanted. One of them,
Sidney Webb, questioned Douglas quite thoroughly on all the details of
his "Plan", and could find no fault in it on any technical
grounds. But still rejected it because he didn't like its
"object".
That "object" was the antithesis of the Fabian socialism
Webb, and others like him, really wanted. It would have led to a genuine
'economic democracy'. Rather than simply changing the control
of policy to a different group of administrators.
Ones who, like all 'socialists' I've known, (most of
whom I've found are actually quite decent people ), are sure they know
better than you do what's best for you. And are determined to impose all
the wonders the 'socialist' State can provide on you, whether YOU want
them or not. (And even if you don't, you still HAVE to pay for them ~
one way or another!)
Regards,
Joe
----- Original Message -----
Sent: Wednesday, November 26, 2008 1:26
PM
Subject: RE: [socialcredit] Finance:
Credit "Crisis" and "Depression"
I tnink you mnay have that wrong, Joe. I think the
truth might be that, like here, the Labour Party was interested in it but
the socialist faction forced it out.
Labour here was originally unionist
and backed by small farmers, even small businessmen. It's socialist faction
was relatively small, and part communist, with strife between the two
arms. I have been told there were 14 monetary reformers (not all SC,
some followed Soddy or possibly others) in the first Labour caucus of about
54. They and also the communists got wedged out by the hard-core
socialists.
Itis one of the fallacies of edited history that all workers'
parties were always Marxian.
Regards.
John
R.
From: thomsonhiyu@shaw.ca
To: socialcredit@elistas.com
Date: Wed, 26
Nov 2008 08:24:42 -0800
Subject: Re: [socialcredit] Finance: Credit
"Crisis" and "Depression"
It was once ''well received'' in the
'socialist' British Labour Party, too. Until they realized its
"object" was something which did not quite mesh with the kind of
socialism envisioned by many of that group's 'guiding
lights'.
Joe
----- Original Message -----
Sent: Wednesday, November 26, 2008
6:42 AM
Subject: Re: [socialcredit] Finance:
Credit "Crisis" and "Depression"
Funny you should mention
socialists. I'm not exactly a socialist, but I am a member of
SDUSA/Socialist Party of America. (if there were a proper Christian
Democratic party around I'd camp there!) We operate mostly within
the Democratic Party and are open to working with Republicans as well. The
few times I have brought up social credit in our national committee
meetings it has been well received.
-----Original Message-----
From: John G Rawson
<johngrawson@hotmail.com>
To: Socred elistas
<socialcredit@elistas.com>
Sent: Wed, 26 Nov 2008 12:51
am
Subject: RE: [socialcredit] Finance: Credit "Crisis" and
"Depression"
Thanks, Wally. It's all becoming so transparently clear. But nobody
important seems to be catching on. Particularly not among the
Socialists. Regards.
John R.
From: wmklinck@shaw.caTo: socialcredit@elistas.comDate:
Mon, 24 Nov 2008 15:31:58 -0700 Subject: Re: [socialcredit] Finance:
Credit "Crisis" and "Depression" The system, being increasingly
non- self-liquidating=2 0causes the financial world to resort to a
proliferating series of evermore tenuous artifices in an attempt to make
an unworkable system function. When the debt load becomes stretched
to the limit of any hope of debts being serviced confidence breaks and the
whole thing comes down like a deck of cards, making nonsense of all
previous denials that the financial system is unsound. Then the
government, if wholesale ruination is to be avoided, is more or less
compelled to intervene with injection of more of the same debt poison
which caused the collapse in the first place. They just borrow more
money from the banking system and carry on by further inflation of the
money supply with it concomitant upward pressure on the price-level, the
inherent deficiency of purchasing-power being set off further into the
future by transforming the debt of the private sector into permanent state
debt. Of course we are all expected to work harder and longer to
meet the burden of inflating prices and increased taxation resulting from
interest charges on bloating state debt. Of course, attempts by the
state to reverse this situation by endeavoring to run on balanced budgets
and to pay down state debt just constricts the economy while leaving the
community of lesser governments and individuals to shoulder the burden of
the false debts that are increasing exponentially. We now witness
the futility and tragedy of this unrealistic policy in the recent
so-called credit "meltdown" and the inevitable contraction of the=2
0economy which must come from the deflation. But it serves those who
confiscate the wealth of others and those who would enhance the power of
the state by proposing increasing state intervention in the lives of the
people--serving also the policy of forcing nations increasingly into
mergers leading to an eventual global government..
Sincerely
Wally Klinck
On 24-Nov-08, at 12:23 PM, John G Rawson wrote:
That is correct here too.
I guess worldwide it was decided to abasndon what our Monetary
Commission referred to as a "blunt instrument" for controlling the money
supply in favour of controlling the "willing borrower" aspect by varying
the price, i.e. interest rates. But that doesn't alter the fact that
the banking system needs reserves for interbank transactions, and in the
present situation, to shore up payments for withdrawals of
deposits. In effect, this is what the "bailout" is trying to
do. Amazing how governments are required to keep out of
banking, except when the banks need h elp! Regards.
John R.
From: wmklinck@shaw.caTo: socialcredit@elistas.comDate:
Mon, 24 Nov 2008 01:03:21 -0700 Subject: Re: [socialcredit] Finance:
Credit "Crisis" and "Depression" My understanding is that in
Canada reserve ratio requirements were discontinued some time ago for
banks operating under Federal Charter--and that only certain capital
requirements remain.
Wally
On 23-Nov-08, at 6:42 PM, John G Rawson wrote:
Sorry. It
is standard for banking anywhere. They can not lend their
liabilities. That applies to savings banks too, but it seems most of
them draw on commercial banks to back them. Money supply M1 (or M2
or higher) includes, as its major component "demand deposits with the
financial institutions". That is where the money20paid into a bank
goes. The only ways banks could lend "money paid in to them" would be
if the deposits were reduced when this happened (they are not) or if
by some way the money magically doubled as it was paid in to the bank.
That is not the point at which it is considered to be
multiplied. Every new bank loan results in a creation of that
amount of new money 'out of nothing'. But, of course, banks need
reserves to guard their deposits. And also, under fractional reserve
banking, any bank that suffers complete loss of confidence by the
public must go broke. That is where the relevance of the
reserve/deposit ratio comes in. Regards. John
R
From: telergy@bigpond.comTo: socialcredit@elistas.comDate:
Mon, 24 Nov 2008 09:19:07 +1100 Subject: Re: [socialcredit]
Finance: Credit "Crisis" and "Depression"
Well John R
it differs in different Nation States. In the
US, I think Clinton removed the seperation of lending banks and
investment banks,so that they can do both.
Australia's bank regulators kept ratios to about
10%, quite healthy compared to US and Europe.
George Jr and Greenspan don't believe in
regulation.
The best overview I get is from following
speeches at BIS (Bank of International Settlements) where central
bankers they openly talkabout increasing liquidity by lowering the
ratios for their banks.
My easy english version goes
"Imagine a money lender around AD 10. He has a
bag of gold, and people want to borrow some. More people want a loan
than the amount of gold he has. He realises that, by issuing tokens,
he can extend credit to all who want some, assuming that the debtors
are a good risk, and will be paying it back on time."
cheers
Graeme Taylor
ps Whatever has happened to all that gold in
Fort Knox?
-----
Original Message -----
Sent: Monday,
November 24, 2008 7:36 AM
Subject: RE:
[socialcredit] Finance: Credit "Crisis" and "Depression"
It is also a totally wrong explanation, and a not
uncommon error. 2% reserve ratio means $100 of loans for every £2 of
RESERVES. Since loans create deposits, that ratio could never be
attained under any circumstances where deposits are concerned. The
writer forgot that bank deposits are their liabilities, and can
never be lent.
Regards.
John R.
From: wmklinck@shaw.ca
To: socialcredit@elistas.com
Date:
Sun, 23 Nov 2008 00:08:02 -0700
Subject: Re: [socialcredit]
Finance: Credit "Crisis" and "Depression"
This not really an
alternate explanation. It is simply the false explanation
which has been promulgated from establishment sources. We are
well aware that every imaginable artifice involving the extension of
debt has been devised to make the economy function under a
fundamentally and fatally defective and unworkable financial system.
What do you mean by saying that you are "pretty well over the
soc red concept"? Do you mean that you possess a good
understanding of it?--or that you hold little or no hope of it being
an effective solution to financial and economic problems of the
industrialized world? Social Crediters intend to make it
relevant and we cannot afford to heed defeatist opinions. We
are currently provided with an almost unprecedented opportunity to
advance our cause and we must press on with increasing intensity.
So--down with hesitation and doubt and on with the job!
I would not hold out much hope from Barak Obama's term of
office. Already he has declared his intent to provide "jobs"
for the population--hardly a Social Credit policy.
Wally
On 21-Nov-08, at 8:47 PM, Graeme Taylor wrote:
Herewith an alternate
explanation
Because Green spam believed in the
market and self-correction of itself, he saw no need to regulate
the lending (reserve) ratios of the banks. Thus, it went below
2%.
That is, for every two dollars
deposit, a hundred in loans.
Europe's banks, attempting to
maintain market share, dropped their ratios down to 4 or 5%.
Easy money for borrowing, and a race to the bottom.
The CHinese Banks, in August
began by dropping their ratio for their Rural Bank to below
17% so as to increase liquidity in the hope that rual incomes
could start to catch up to urban ones.
Now, I guess, they have dropped
their Infrastructure Bank's ratios as an economic stimulus
package.
Gordon Brown thought the best thing
to do is to invest in the banks. Yep. More money in the coffers
helps raise the lending ratios of their banks.
With a 2% ratio, (fractional reserve
money backed by virtually nothing), only a small proportion of
debtors going bankrupt sends the bank belly up.
I do hope that Barack gets better
advice than George Jr got.
I'm pretty over the soc cred concept.
Seriously, with up to 20% of the economy being illicit (drugs,
extortion), no perfect formula is gonna work, same as with people
going bankrupt.
cheers
Graeme Taylor
----- Original Message -----
Sent: Friday,
November 21, 2008 10:12 PM
Subject: [socialcredit]
Finance: Credit "Crisis" and "Depression"
This message has been sent to all Members of the Canadian
House of Commons:
I am forwarding a document outlining the
basic and underlying, as opposed to superficial, causes of
the current disastrous and ruinous credit "crisis" and the
primary essential remedial measures required to effect an honest
and stable financial system with it corollary, a viable
producing and consuming economic system. Also attached is
a short PDF showing how the Keynesian equations can be modified
to achieve these ends. (Not included in this
posting.)
Yours sincerely
Wallace M.
Klinck
FINANCE, DEBT AND
DEPRESSION
The
so-called economic and financial "experts" are apparently
totally oblivious to the fact that the financial price-system is
fundamentally and increasingly non- self-liquidating.
Consequently, they blame the credit "meltdown" and ensuing
economic collapse on excessive extension of loans (debt) issued
primarily without adequate regulatory legislation. The essential
problem is that while the convention is that industry, in order
to remain viable, must recover its financial costs in final
prices, the existing financial system makes this a mathematical
impossibility.
Final
price appears at the retail level. Consumers, being at the end
of the economic process, are required through expenditure of
their income, to liquidate all the financial costs of
production. That is a perfectly reasonable and accepted
accountancy convention. The crux of the liquidity failure is
that, primarily due to the need for industry to add to ret ail
prices certain increasing allocated charges in respect of
capital, which do not constitute payment of income in the same
cycle of production, consumers are increasingly short of income
by which to meet the total retail prices necessarily charged by
industry.
Obviously,
if nothing intervened the economy would shut down. Of course,
what happens is that the consumer is evermore under necessity of
borrowing (contracting debt obligations) from the banking
system, that creates out of nothing the money that it lends as a
repayable debt. Eventually the debt overload so erodes the
liquidity of the financial system and the ability of consumers
to contract and service debt that consumers can no longer keep
borrowing and/or lenders cease to provide loans (in preparation
for a "clean out" by foreclosure upon the assets of the people
who have laboured to produce and acquire real
wealth).
There
is nothing new about this confiscatory process. It has been
characteristic of the credit system for hundreds of years—going
back before creation
of the Bank of England in 1694. It can only be a deliberate
policy on the part of the few who are insiders "in the kno w" to
confiscate property and centralize both ownership of property
and political power.
If
the "experts" advice were followed and lending was simply
restricted, this would just slow down the development of
economic activity in spite of the national real capacity to
conduct and expand that activity. This would intensify the
problem of providing "jobs" with which they seem to be so
strangely concerned—showing again a complete confusion of mind
about the purpose of production—which purpose is not to provide
work for humanity but to provide desired goods and services with
maximum efficiency—which process involves minimization of all
costs, including that of labour. The purpose of production is
consumption—not the creation of work.
The
unfathomable fact is that so-called orthodox "economists" and
public policy makers think first of financial factors and last
of real, physical factors— and mindlessly accept the financial
system as a determinant of physical activity. Money is simply a
unit of account and should merely reflect, and never control,
our physical activity. The
whole thing, being a complete departure from reality, is quite
psychotic.
We
are told by our “expert” advisers that we are being cast into an
economic recession or slow down in actual physical production.
Have we suddenly lost our energy resources (our gas, petroleum
and electrical power), our mines and minerals, our information
and transportation services, our forests, our cultural heritage
of know-how and production expertise, etc.? Have our citizens
suddenly decided to sit down on their posteriors and not do
anything any more—has everyone suddenly become divested of
motivation, intelligence and capability? Our course not. On a
physical level everything remains essentially unchanged with an
already astonishing technological efficiency and productivity
only increasing exponentially over time. Yet, we are informed by
the “experts” that we are slipping inevitably into a recession
involving the slow down of real production. Anybody who believes
this to be unavoidable, as though some consequence natural law,
and is so perverse as to continue to believe it in the face of
actual facts, probably fully deserves the consequences of their
stupidity.
As,
William Aberhart, Social Credit Premier of the Province of
Alberta said years ago, "If the people haven't suffered enough,
it is20their God-given right to suffer some more." I think
people are guilt-ridden, because of sedulously inculcated false
moral imperatives, such as the adulation of work for it’s own
sake. Consequently they are masochistic, and therefore welcome
misery as a penance and cathartic for their induced artificial
and misguided feelings of guilt. The whole thing is quite
mad.
The
physical cost of production is fully met when goods arrive
completed at retail. There is no need whatsoever for consumer
debt. What is required before all else is a secondary flow of
consumer credits injected extraneously into the price-system
without debt as Consumer Dividends and to effect Compensated
(lowered) Retail Prices at point of sale in order to permit
consumers full, immediate and dynamic access to all retail
goods—and to balance the price-system, so allowing business to
recover its financial costs so that it can continue to serve the
community if consumers so desire.
As
C. H. Douglas, founder of the Social Credit movement who offered
the only realistic alternative to currently accepted and
destructive Keynesian debt finance, said, "society is hypnotized
and only a drastic dehypnotization can save it." How much abuse
does it take t o arouse a placid and somnolent
public?
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