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The Debt Based Economic System


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I am a firm believer that all our current economic woes are the result of a financial system that is based upon the creation of money as debt.

I'm currently reading 'The Grip Of Death' by Michael Rowbotham and everything he says rings true to me at least. I was wondering if anybody on these forums actually believes that allowing private banks to create money as debt 'out of thin air' is a good thing? If anybody would like to defend the current state of affairs in regards to money creation I'd be most interested in trying to understand their reasoning. Perhaps there is some serious flaw in the rationale of the money reformers that I'm missing - at the moment I'm firmly of the position that this legalised fraud must end.

Secondly, if most people here believe that the banking system itself is the biggest economic question that needs addressing then how can we get it onto the political agenda? How can we change the curent political discourse? Can it really be done without resorting to violence?

Currently I feel I'm torn between spending the next twenty years of my life banging my head against a wall, in the vain hope that somebody in a postition of power might pick up on the cause, because in a heirachy of credibility I'm at the bottem end having had no formal education in economic theory. Or I could just say ****** IT and dissapear into computer games until the power eventually goes off and people start rioting. I must admit the latter option seems the most appealing at the moment because I'm sick of watching endless arguements between politicians who never address what I believe is the biggest problem out there.

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Secondly, if most people here believe that the banking system itself is the biggest economic question that needs addressing then how can we get it onto the political agenda? How can we change the curent political discourse? Can it really be done without resorting to violence?

I'm wondering the same thing. But I'm pretty sure that not even violence would achieve it since that'd just give them a reason to roll out the heavy handed riot squad while the newspapers brandish the protesters as extremists.

All in all, I think we're f*cked..

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Some say it creates more rapid growth, but others would say it creates more bubbles. My opinion is that it encourages mal-investment, inflation and general instability - exaggerated booms and busts.

Think about all the time spent fighting with credit inflation and deflation. Think about how hard it makes it to prepare for later in life. Think about how much the financial sector casts a shadow over the rest of the economy. There are alternatives and I can't believe what we have now is the "best" way to do things.

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Some say it creates more rapid growth, but others would say it creates more bubbles. My opinion is that it encourages mal-investment, inflation and general instability - exaggerated booms and busts.

Think about all the time spent fighting with credit inflation and deflation. Think about how hard it makes it to prepare for later in life. Think about how much the financial sector casts a shadow over the rest of the economy. There are alternatives and I can't believe what we have now is the "best" way to do things.

no doubting it creates extreme volatility (progression/regression) but i tend to err on the side of it also creating the most rapid way to grow. what slows the whole process down, on the bust side seems to be govt interference, whilst only magnifying the end result to the downside

Edited by Tamara De Lempicka
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I am a firm believer that all our current economic woes are the result of a financial system that is based upon the creation of money as debt.

i am not. i think this view, which i have heard time and again, is extremely mislead.

please read human action by von mises. it will sort your head out and teach you all about money and credit.

ps

Perhaps there is some serious flaw in the rationale of the money reformers that I'm missing

yes there is! it proposes to replace the current fiat money regime with an identical one, only put in the hands of people for whom we can trust more to safeguard our interests. please!

allowing competiting currencies and ending the government monopoly on what we are forced to call money is the only (and obvious, you would think) solution.

Edited by Where is my pen?
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Buy gold/silver. Barter/trade with other people. Avoid using the fiat money system at every opportunity.

that is unfortunately what they are pushing us towards. it will be a very hard world indeed with only an ad-hoc currency market to support trade. and all because the government has destroyed its own creditability whilst bloody mindedly refusing to support any competition to fill the vacuum as the fiat system is implodes.

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I am a firm believer that all our current economic woes are the result of a financial system that is based upon the creation of money as debt.

I'm currently reading 'The Grip Of Death' by Michael Rowbotham and everything he says rings true to me at least. I was wondering if anybody on these forums actually believes that allowing private banks to create money as debt 'out of thin air' is a good thing? If anybody would like to defend the current state of affairs in regards to money creation I'd be most interested in trying to understand their reasoning. Perhaps there is some serious flaw in the rationale of the money reformers that I'm missing - at the moment I'm firmly of the position that this legalised fraud must end.

Secondly, if most people here believe that the banking system itself is the biggest economic question that needs addressing then how can we get it onto the political agenda? How can we change the curent political discourse? Can it really be done without resorting to violence?

Currently I feel I'm torn between spending the next twenty years of my life banging my head against a wall, in the vain hope that somebody in a postition of power might pick up on the cause, because in a heirachy of credibility I'm at the bottem end having had no formal education in economic theory. Or I could just say ****** IT and dissapear into computer games until the power eventually goes off and people start rioting. I must admit the latter option seems the most appealing at the moment because I'm sick of watching endless arguements between politicians who never address what I believe is the biggest problem out there.

Of course they won't address the problem, they are part of it. As for violent protest, that just plays into their hands. What is needed is mass civil disobedience. It can be done, I know it was only small stuff but the RATM vs X factor facebook campaign shows what can be acheived if enough people say no more. The system requires for x% of the population to behave as sheep. Once that figure becomes x-1%, things start to get interesting. The buyers strike campaign on Facebook might just be the first step.

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I am a firm believer that all our current economic woes are the result of a financial system that is based upon the creation of money as debt.

I'm currently reading 'The Grip Of Death' by Michael Rowbotham and everything he says rings true to me at least. I was wondering if anybody on these forums actually believes that allowing private banks to create money as debt 'out of thin air' is a good thing? If anybody would like to defend the current state of affairs in regards to money creation I'd be most interested in trying to understand their reasoning. Perhaps there is some serious flaw in the rationale of the money reformers that I'm missing - at the moment I'm firmly of the position that this legalised fraud must end.

Secondly, if most people here believe that the banking system itself is the biggest economic question that needs addressing then how can we get it onto the political agenda? How can we change the curent political discourse? Can it really be done without resorting to violence?

Currently I feel I'm torn between spending the next twenty years of my life banging my head against a wall, in the vain hope that somebody in a postition of power might pick up on the cause, because in a heirachy of credibility I'm at the bottem end having had no formal education in economic theory. Or I could just say ****** IT and dissapear into computer games until the power eventually goes off and people start rioting. I must admit the latter option seems the most appealing at the moment because I'm sick of watching endless arguements between politicians who never address what I believe is the biggest problem out there.

Credit creates the ability to grow faster. For its routes you need to look at what happened to Britain between 1756 - 1763. By 'inventing' credit Britain became a super power. A model replicated now around the world.

Credit is fine, the idea in principle is fine. The problems as I see them with the current system is who can create credit? who controls the credit? should credit be only available to invest in productive assets? The answers to these questions lie at the heart of my reasoning why the system creates booms and busts.

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This issue gets raised time and again, unfortunately people like Michael Rowbotham are deeply misled confused individuals who insist on leading many others down this intellectual dead end.

First off, there's nothing wrong with charging people for the creation of money, despite claims that banks are making money out of 'thin air' it still costs money to provide their services. Banks have to pay staff, they need to pay taxes and shareholders, they need to rent buildings and they need tools like computers etc. All this costs, so one way or another banks will have to charge and it doesn't matter whether this is interest or charged at a flat rate.

Also, even if currency system was fundamentally unstable it wouldn't be an economic issue at all. It would be a tehcnical one. People often argue that there isn't enough money because banks lend it at interest, I don't believe that this is true, but even if it was it doesn't stop people from performing £x of work for each other. So I owe you £20, I can perfom £20 worth of work and we're all square. The money supply just makes this process easier, not harder.

Its not in the banks interest for there not to be enough money because it would mean they wouldn't get paid, nobody wants that. We need to ensure that people pay their debts and the money supply is used to that end, not highjacked so that people cannot perform their obligations to one another. It would be totally self defeating!

The major problem is the debt based land system that we have. Imagine, the people of a certain communtiy decide that they're too poor so they start working really hard to build up the wealth in the local area. So, they add infrastructure like railways, schools, hospitals and the like. The private sector benefits from investment which upgrades local shops and services, new companies open up like cinemas, theatres, larger supermarketc etc etc. What happens to house prices in the local area? They start to raise to due to all the increased economic activity going on so people start speculating in land which raises its price even further. So now all the effort that was expended making peoples lives richer has just ended up as increased costs for themselves because local landlords just raise the rents and their asking prices for houses.

The land cartel, not the money cartel acts as an unavoidable barrier which robs the productive of their wages and keeps them in the shackles of debt. When you take out a mortgage the money doesn't go to the bank, it goes to the previous landlord.

People are looking for an active conspiracy which is why they choose the banks as their targets. They just can't see that there is no active conspiracy going on, the economic laws dictate that surpluses will end up as gains for homeowners, but this is much too subtle for many to grasp.

Edited by chefdave
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The answers to these questions lie at the heart of my reasoning why the system creates booms and busts.

If we are in a bust phase do you have an opinion in relation to fiat whether Gold and Silver will rise in value considerably.?

I have no opinion either way but I`m fascinated by the emotion PM`s engender.

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The whole debt based fiat printy printy money system is a fraud!

The faster people wake up and realise this the better.

Politicians should not be in control of a printing press. They didn't even see 2008 coming for christ sake :ph34r:

Money is/will start heading towards real assets (those that are limited in supply).

Gold and Silver related assets are the only real place to be. People shout Gold 'bug' bla bla, but with that they are missing the big picture and are not thinking outside the box (fiat world).

Keep stacking and keep your eye on those bond markets!

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This issue gets raised time and again, unfortunately people like Michael Rowbotham are deeply misled confused individuals who insist on leading many others down this intellectual dead end.

First off, there's nothing wrong with charging people for the creation of money, despite claims that banks are making money out of 'thin air' it still costs money to provide their services. Banks have to pay staff, they need to pay taxes and shareholders, they need to rent buildings and they need tools like computers etc. All this costs, so one way or another banks will have to charge and it doesn't matter whether this is interest or charged at a flat rate.

Also, even if currency system was fundamentally unstable it wouldn't be an economic issue at all. It would be a tehcnical one. People often argue that there isn't enough money because banks lend it at interest, I don't believe that this is true, but even if it was it doesn't stop people from performing £x of work for each other. So I owe you £20, I can perfom £20 worth of work and we're all square. The money supply just makes this process easier, not harder.

Its not in the banks interest for there not to be enough money because it would mean they wouldn't get paid, nobody wants that. We need to ensure that people pay their debts and the money supply is used to that end, not highjacked so that people cannot perform their obligations to one another. It would be totally self defeating!

The major problem is the debt based land system that we have. Imagine, the people of a certain communtiy decide that they're too poor so they start working really hard to build up the wealth in the local area. So, they add infrastructure like railways, schools, hospitals and the like. The private sector benefits from investment which upgrades local shops and services, new companies open up like cinemas, theatres, larger supermarketc etc etc. What happens to house prices in the local area? They start to raise to due to all the increased economic activity going on so people start speculating in land which raises its price even further. So now all the effort that was expended making peoples lives richer has just ended up as increased costs for themselves because local landlords just raise the rents and their asking prices for houses.

The land cartel, not the money cartel acts as an unavoidable barrier which robs the productive of their wages and keeps them in the shackles of debt. When you take out a mortgage the money doesn't go to the bank, it goes to the previous landlord.

People are looking for an active conspiracy which is why they choose the banks as their targets. They just can't see that there is no active conspiracy going on, the economic laws dictate that surpluses will end up as gains for homeowners, but this is much too subtle for many to grasp.

I don't argue that the land monopoly isn't a primary problem. However, I think you are down playing the flaws in the financial system. There are lots of places in the world where there isn't a shortage of land, yet the bubble in prices still formed, as one person bid with borrowed money off another. The easy credit was like pouring petrol on a fire, causing a huge boom, with a huge bust following.

Even putting aside the problems with credit exaggerating the up and down swing of the boom/bust cycle, there is a whole other side about counter party risk and who is responsible for it. The crux of the current crisis is that banks took risks, which made some very wealthy, but ultimately left the taxpayer to pick up the bill; if we hadn't, the banking system could have imploded, causing chaos in the process.

For me, this goes beyond house prices, whether or not banking is fraudulent, whether it fuels boom/bust - it is the fact that the whole system is "too big to fail". As a result, bad banks aren't being allowed to fail, but are instead propped up by bailouts, which just encourages more of the same, risky, behaviour. More bubbles, more bailouts, more mal-investment.

If we are going to stick with the current system, all banks have to be allowed to fail, should they have been foolish. As, politically, this will not be allowed to happen, the risk needs to be moved from the banks to the individuals. Free market money, in some guise, which can cause loss as well as gain will spread the risk across all participants. Limited Purpose Banking provides a framework for this, which would be compatible with people's current expectations of money.

Finally, consider than our current banking system doesn't really have a reverse gear. They can only offer positive interest, which needs growth to feed it. Without growth, there can be no interest afforded. Even considering positive growth, the current model rewards those with capital, with yet more capital (interest), without risk (deposit guarantees). This can only widen the gap between rich and poor, with the average taxpayer guaranteeing the deposits of the rich.

If we are to enter a multi-decade lull in growth, with periods of negative growth, the current system is going to give prolonged problems. You either go the cashless route, al la Scepticus, then force all savers into putting up with negative rates (hoping there won't be a run on the banks or their currencies - a dash for assets) or you move the risk to individuals (with LPB). With the latter, if there is little growth, many will lose money (like a negative interest rate), but the smart investors will make money. Those who sit it out (with the money left idle, but safe, in the bank) will just retain their wealth. There would be no systemic risk with LPB, with each person taking their own risks - no gain, without risk of pain.

To dismiss the need for financial reform, based on the "Money as Debt" etc videos is missing much of the point - there are other, very serious, problems with the current system that really shouldn't (and soon, may not be able to) be ignored.

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I don't argue that the land monopoly isn't a primary problem. However, I think you are down playing the flaws in the financial system. There are lots of places in the world where there isn't a shortage of land, yet the bubble in prices still formed, as one person bid with borrowed money off another. The easy credit was like pouring petrol on a fire, causing a huge boom, with a huge bust following.

Even putting aside the problems with credit exaggerating the up and down swing of the boom/bust cycle, there is a whole other side about counter party risk and who is responsible for it. The crux of the current crisis is that banks took risks, which made some very wealthy, but ultimately left the taxpayer to pick up the bill; if we hadn't, the banking system could have imploded, causing chaos in the process.

For me, this goes beyond house prices, whether or not banking is fraudulent, whether it fuels boom/bust - it is the fact that the whole system is "too big to fail". As a result, bad banks aren't being allowed to fail, but are instead propped up by bailouts, which just encourages more of the same, risky, behaviour. More bubbles, more bailouts, more mal-investment.

If we are going to stick with the current system, all banks have to be allowed to fail, should they have been foolish. As, politically, this will not be allowed to happen, the risk needs to be moved from the banks to the individuals. Free market money, in some guise, which can cause loss as well as gain will spread the risk across all participants. Limited Purpose Banking provides a framework for this, which would be compatible with people's current expectations of money.

Finally, consider than our current banking system doesn't really have a reverse gear. They can only offer positive interest, which needs growth to feed it. Without growth, there can be no interest afforded. Even considering positive growth, the current model rewards those with capital, with yet more capital (interest), without risk (deposit guarantees). This can only widen the gap between rich and poor, with the average taxpayer guaranteeing the deposits of the rich.

If we are to enter a multi-decade lull in growth, with periods of negative growth, the current system is going to give prolonged problems. You either go the cashless route, al la Scepticus, then force all savers into putting up with negative rates (hoping there won't be a run on the banks or their currencies - a dash for assets) or you move the risk to individuals (with LPB). With the latter, if there is little growth, many will lose money (like a negative interest rate), but the smart investors will make money. Those who sit it out (with the money left idle, but safe, in the bank) will just retain their wealth. There would be no systemic risk with LPB, with each person taking their own risks - no gain, without risk of pain.

To dismiss the need for financial reform, based on the "Money as Debt" etc videos is missing much of the point - there are other, very serious, problems with the current system that really shouldn't (and soon, may not be able to) be ignored.

I didn't argue that there was a shortage of land, this misses the point. In a modern capitalist economy with a universal currency system the surpluses of production end up in the land market which acts to raise its price. It then becomes a tool for speculation because its a prime target for extracting wealth from the productive without having to go through the effort of doing any of the producing yourself. This is quite seperate from the banking system, they do produce something useful so they need to get paid for it otherwise they'll stop producing it, this logic doesn't apply with landlords. They don't produce that which they're receieving payment for so if we stop paying them we're no worse off. In fact we'd be much better off as our costs would have been reduced.

As for all the risk, it would be greatly reduced if we actively sought to lower land prices to their cost of production; £0, then people wouldn't be constantly struggling to make ends meet just so they can pay their mortgage. This is where the real risk is, not on banks' balance sheets.

I've just had a new housemate move in and he's training at the FSA, the new paradigm is a complex system of risk management and compulsory insurance which is aimed at stopping something like the credit cruch from ever happening again. Well we can arrange the deckchairs on the titanic if it makes us feel like we're 'doing something', but shifting this risk around, insuring it, and allowing banks to collpase under the weight of their own debt doesn't tackle the core problem; high land prices.

The monetary system would work fine if it wasn't abused by rent seekers.

Edited by chefdave
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I didn't argue that there was a shortage of land, this misses the point. In a modern capitalist economy with a universal currency system the surpluses of production end up in the land market which acts to raise its price. It then becomes a tool for speculation because its a prime target for extracting wealth from the productive without having to go through the effort of doing any of the producing yourself. This is quite seperate from the banking system, they do produce something useful so they need to get paid for it otherwise they'll stop producing it, this logic doesn't apply with landlords. They don't produce that which they're receieving payment for so if we stop paying them we're no worse off. In fact we'd be much better off as our costs would have been reduced.

As for all the risk, it would be greatly reduced if we actively sought to lower land prices to their cost of production; £0, then people wouldn't be constantly struggling to make ends meet just so they can pay their mortgage. This is where the real risk is, not on banks' balance sheets.

I've just had a new housemate move in and he's training at the FSA, the new paradigm is a complex system of risk management and compulsory insurance which is aimed at stopping something like the credit cruch from ever happening again. Well we can arrange the deckchairs on the titanic if it makes us feel like we're 'doing something', but shifting this risk around, insuring it, and allowing banks to collpase under the weight of their own debt doesn't tackle the core problem; high land prices.

The monetary system would work fine if it wasn't abused by rent seekers.

Not all booms/busts have been in property though (tulip bulbs spring to mind), even if it has been a popular one (likely because Basel regulation gives a low risk weighting to property loans). Do you think there would be no more credit fuelled booms/busts with a LVT?

I'm not saying that a LVT isn't a good idea - far from it, I think it's a great idea - but the banking system needs changing too.

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Not all booms/busts have been in property though (tulip bulbs spring to mind), even if it has been a popular one (likely because Basel regulation gives a low risk weighting to property loans). Do you think there would be no more credit fuelled booms/busts with a LVT?

I'm not saying that a LVT isn't a good idea - far from it, I think it's a great idea - but the banking system needs changing too.

If a LVT was applied so that it actively sought to bring the exchange price of land as close to £0 as possible the most damaging form of speculation that we suffer from would be greatly reduced.

Does it solve all economic problems? No. Does it totally stop inflation and deflation? Of course not (not that I think general inflation and deflation should be stopped or centrally manipulated, but thats another matter)

But if people wanted to engage in speculative activity then they'd largely be constrained from adversely impacting others with their recklessness. Not all forms of speculation harm innocent bystanders, common gambling being the most obvious example. If people want to put their life savings into vintage wine/BP shares/The 3.30 at Chepstow I see no reason why they should be stopped or regulated against. Just let them know that they won't be bailed out if it all goes pear shaped.

But when we're talking about jamming up an entire factor of production then its a different story, and changing the money supply doesn't deal with that.

Edited by chefdave
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If a LVT was applied so that it actively sought to bring the exchange price of land as close to £0 as possible the most damaging form of speculation that we suffer from would be greatly reduced.

Agreed.

Does it solve all economic problems? No. Does it totally stop inflation and deflation? Of course not (not that I think general inflation and deflation should be stopped or centrally manipulated, but thats another matter)

Banking reform could well stop monetary inflation/deflation - fixing the supply of fiat would see to that. Sure, it's value may increase/decrease against other commodities/assets, it is impossible to price fix fiat against all of them.

But if people wanted to engage in speculative activity then they'd largely be constrained from adversely impacting others with their recklessness. Not all forms of speculation harm innocent bystanders, common gambling being the most obvious example. If people want to pur life savings into vintage wine/BP shares/The 3.30 at Chepstow I see no reason why they should be stopped or regulated against. Just let them know that they won't be bailed out if it all goes pear shaped.

How about oil speculation? Food speculation? Would these not effect people in a big way too? I agree that LVT would stop a big area of speculation and rent seeking, but I disagree that no other areas would be harmful in a big way. While speculation will always happen and in many different areas (and that is fine too), letting the banks extend credit (from "thin air") against a "sure thing" is risky and, with our current financial system, we as the taxpayers will end up paying for it.

But when we're talking about jamming up a factor of production then its a different story, and changing the money supply doesn't deal with that.

Not sure I understand - do you mean if people bid up resource costs (like oil), it would increase production costs? If so, it is one thing bidding them up with a (relatively) fixed money supply, but it is another if credit floods into the latest flavour of the month (and thus, cranking up the risk from the bust to the rest of us again).

I find it strange that you don't see the financial system as a problem, when there is so much else I agree with you about.

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How about oil speculation? Food speculation? Would these not effect people in a big way too? I agree that LVT would stop a big area of speculation and rent seeking, but I disagree that no other areas would be harmful in a big way. While speculation will always happen and in many different areas (and that is fine too), letting the banks extend credit (from "thin air") against a "sure thing" is risky and, with our current financial system, we as the taxpayers will end up paying for it.

Not sure I understand - do you mean if people bid up resource costs (like oil), it would increase production costs? If so, it is one thing bidding them up with a (relatively) fixed money supply, but it is another if credit floods into the latest flavour of the month (and thus, cranking up the risk from the bust to the rest of us again).

I think the point is, that if the speculative boom is in oil, you can use wind electricity. If it's in food, you can plant your own potatoes. But if it is in land, you are stuffed, because there's no way to live or produce without land. Unless you buy a boat to live on, and eat seaweed and fish...

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Agreed.

Banking reform could well stop monetary inflation/deflation - fixing the supply of fiat would see to that. Sure, it's value may increase/decrease against other commodities/assets, it is impossible to price fix fiat against all of them.

How about oil speculation? Food speculation? Would these not effect people in a big way too? I agree that LVT would stop a big area of speculation and rent seeking, but I disagree that no other areas would be harmful in a big way. While speculation will always happen and in many different areas (and that is fine too), letting the banks extend credit (from "thin air") against a "sure thing" is risky and, with our current financial system, we as the taxpayers will end up paying for it.

Not sure I understand - do you mean if people bid up resource costs (like oil), it would increase production costs? If so, it is one thing bidding them up with a (relatively) fixed money supply, but it is another if credit floods into the latest flavour of the month (and thus, cranking up the risk from the bust to the rest of us again).

I find it strange that you don't see the financial system as a problem, when there is so much else I agree with you about.

Do you remember that excellent post you put up a couple of months ago about the NHS? If I recall the underlying logic was that the NHS is now being used as a tool to control people. Because we all have a stake in it, some people believe that they have the right to limit the life choices of others because they'll end up paying for the consequenses if it all goes wrong.

Well I can't help but draw parallels with a lot of thought on banking reform. Because we all need to use the national currency so the logic goes, we also have the right to veto people because their activities might overspill and then have an impact on us. Currency should be no more used as a tool of control any more than the NHS, and that means allowing people to gamble with their money if they choose.

The difference between oil, food and land is that the first two can;

1) Be increased so that the supply meets the new demand

2) Be substituted, so that people start eating bread instead of rice for example

3) Have their levels of consumption reduced so people simply use less of them.

So if oil goes up in price we either use less of it by car sharing for example or walking more, we switch over to other forms of transport such as nuclear powered trains, or we start mining resources that were previously uneconomical. The land market doesn't really work like this, there are no substitutes and there is no physical way of bypassing the land monopolists in the same way that we can avoid using the services of the oil producers or rice farmers. This gives landlords a unique ability, they have to be paid off before we're allowed to produce anything, and this force alone gives the land market a rare 'power' that no other asset class or commodity benefits from. Hence it becomes very expensive if left untaxed.

I do advocate personal responsibility though, if people want to lend their money to the bank they should understand that there's risk involved and that they could lose the lot if things go bad. The risks need to become more obvious so on aggregate we take less of them, or at the very least understand the consequences a little better.

Edited by chefdave
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I think the point is, that if the speculative boom is in oil, you can use wind electricity. If it's in food, you can plant your own potatoes. But if it is in land, you are stuffed, because there's no way to live or produce without land. Unless you buy a boat to live on, and eat seaweed and fish...

Summed up what I was attempting to say in about 1/10 of the time.

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I think the point is, that if the speculative boom is in oil, you can use wind electricity. If it's in food, you can plant your own potatoes. But if it is in land, you are stuffed, because there's no way to live or produce without land. Unless you buy a boat to live on, and eat seaweed and fish...

Sure, which is why I think a LVT is important. However, it doesn't prevent credit booms/busts dragging the taxpayer into it, should the next "sure thing" turn out to be a dud.

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