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Front-page article on the Guardian about the 'magic' of money creation in the banking system:

http://www.guardian.co.uk/commentisfree/2011/nov/15/money-privatised-stealth

(I did search but it doesn't seem to have been posted yet, surprisingly?)

As previously discussed (hat-tip Injin et al), perhaps there is now a growing confluence of means (social networking, and the requirement for mass media to 'open up' somewhat in response), motive (a growing need to fix the increasingly broken money system) and opportunity (a puzzled and receptive 99% who find themselves facing diminishing living standards, and are wondering how that has come to pass).

But then again, as this article asks, Why does positivemoney only have 3153 Facebook likes?

What can be done to further the progress in this area? Any other examples of the meme getting "out there"?

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Well done to Ben Dyson and the positivemoney team for this MSM exposure of the crucial subject of monetary reform.

Looking at the comments, it does seem to have stirred up a hornets' nest. :o

Are you serious? He suggests taking the power to create money away from the banks and handing it to The Bank of England.

An unbiased, neutral no vested interest and non protective bunch they are not.

Giving rich and priveleged people the opportunity of total governance of a nation. Bravo thats a great idea. Completely different from what we already have. NOT. Bens ideas are complete lunacy. Better to form a truly independant body, made from votes of the public to control the most powerful and influential tool we have - money. Not some boys and girls from the old boys club.

EDIT: If you are applauding the exposure alone then fair play, which I think you are, but his answers are woeful.

Check out this article if you want to see my concerns. Accusations by former member of King overstepping the line into Politics.

http://www.guardian.co.uk/media/2010/dec/01/wikileaks-mervyn-king-quit-political-bias

Edited by Redcellar

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This article shows how our of touch and behind the times journalists are. He makes some basic errors that this forum would have clered up years ago.

His central premise is good: we should control our money supply. Unfortunately his monetary ignorance betrays his professions crass betrayal of their duty to their readership, and professional integrity, with regard to the most important issue of the last 60 years.

Edited by switters

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That wingnut posted on here before. he's more than happy to stick your kids and gran in a jail cell to achieve his goal of total state control over money. he wants to pretend that electronic digits on a screen are valuable (rather than the truth which is that they are infinite and therefore valueless.) While he seemed genuine, he's also completely batshit.

Avoid.

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This article shows how our of touch and behind the times journalists are. He makes some basic errors that this forum would have clered up years ago.

His central premise is good: we should control our money supply. Unfortunately his monetary ignorance betrays his professions crass betrayal of their duty to their readership, and professional integrity, with regard to the most important issue of the last 60 years.

money is easy...its a receipt for a thing you monetised charging interest till you have the reciepts back.

what bankers did, was treat the reciepts like they were things, so another piece of paper declaring it was receiving the interest on another 50 receipts became a thing to issue more reciepts for.

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That wingnut posted on here before. he's more than happy to stick your kids and gran in a jail cell to achieve his goal of total state control over money. he wants to pretend that electronic digits on a screen are valuable (rather than the truth which is that they are infinite and therefore valueless.) While he seemed genuine, he's also completely batshit.

Avoid.

Don't hold back Injin. Tell us what you think ;)

Made me laugh. Though I have to ask, what is someone if they are completely batshit. I quite like bats.

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Whatever the merits of the writer and his conclusions it's true to say I think that this is maybe the most dangerous few paragraphs ever published by the MSM and I'm really surprised to see it. Anyone currently labouring under a mountain of personal debt will not be amused to learn that this debt was conjured into existence effortlessly by the hated bankers- now walking away from that debt starts to look like a morally neutral option- not really a fashion of thought the PTB will be happy to see encouraged. :lol:

Edited by wonderpup

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Promises of money != money.

When you give a bank your money, you are swapping it for a promise of money. If you don't want promises of money, but money itself, then don't give it to a bank!

Retail banks don't create money, they create promises of money. You can eat an apple, but you can't eat a promise of an apple. This is really simple stuff, yet folk like Ben just don't seem to get it.

As for what money is, it certainly shouldn't be fiat money either. The government/BoE can't be trusted not to print, as is evident from this crisis. Money should be chosen by individuals in the market place, not by some liars in suits.

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That wingnut posted on here before. he's more than happy to stick your kids and gran in a jail cell to achieve his goal of total state control over money. he wants to pretend that electronic digits on a screen are valuable (rather than the truth which is that they are infinite and therefore valueless.) While he seemed genuine, he's also completely batshit.

Avoid.

+1

Beware false prophets. There will be many claiming to speak in my name before the end of times.

Matthew 24:5

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Here's how it works. When you ask the bank for the money to buy a one-bedroom box in London, the money that appears in your account isn't borrowed from some prudent grandmother's life savings. In fact, the bank simply types those numbers into your account, creating brand new money that you can now spend

This is complete and utter nonsense. I am puzzled as to why anyone would pay the idiot for writing such drivel, or indeed repost this deranged junk. Some of the comments point this out clearly enough, but there is an awful lot of Guardian readers who have fallen for it hook-line-and-sinker on there too.

I have sent an email to the Guardian, and hope others will also.

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This article shows how our of touch and behind the times journalists are. He makes some basic errors that this forum would have clered up years ago.

Indeed, what he says rhymes with the way it actually works but he does make a number of errors. Although the gulf in understanding is much worse with the commentators below the article. .

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Promises of money != money.

When you give a bank your money, you are swapping it for a promise of money. If you don't want promises of money, but money itself, then don't give it to a bank!

Retail banks don't create money, they create promises of money. You can eat an apple, but you can't eat a promise of an apple. This is really simple stuff, yet folk like Ben just don't seem to get it.

As for what money is, it certainly shouldn't be fiat money either. The government/BoE can't be trusted not to print, as is evident from this crisis. Money should be chosen by individuals in the market place, not by some liars in suits.

That promise of money is treated the same as pure printed money in the system. Say I take out a mortgage for 200k and my bank creates the 'promise to pay', and my lawyer hands you the cheque for 200k, you deposit it into your bank account. And then you spend it just the same as any other money you have. No one stops you at a store and says, hey is this promise to pay money?

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Its great to see this brought up in the mainstream. I personally believe in the state creating 100% of the money in the system, and simply spending it into the system as part of the national budget.

For those who don't believe in the credibility of the state money authority in such a system, they are free at any time to transfer their money into either gold or some type of private currency system. (or more likely do what people have done through history and buy other types of 'currency' like stocks and real estate.)

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on a similar tone. i noticed over the last 1-2 months that they are breaking in the general public piecemeal. its too much of a shock to deliver wholesale, but slowly and surely they are leading people to the fact that the next 20-30 years will to total hell.

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This is complete and utter nonsense. I am puzzled as to why anyone would pay the idiot for writing such drivel, or indeed repost this deranged junk. Some of the comments point this out clearly enough, but there is an awful lot of Guardian readers who have fallen for it hook-line-and-sinker on there too.

I have sent an email to the Guardian, and hope others will also.

That statement seems to have stirred up a hornets' nest on the Guardian website, and I can't see much wrong with it. I thought it was now fairly common knowledge that this is what happens.

Is the Deputy Governor of the Bank of England, Paul Tucker, an 'idiot' for writing similar 'drivel'?

"Subject only but crucially to confidence in their soundness, banks extend credit

by simply increasing the borrowing customer’s current account, which can be paid away

to wherever the borrower wants by the bank ‘writing a cheque on itself’. That is, banks

extend credit by creating money."

http://www.bankofengland.co.uk/publications/speeches/2007/speech331.pdf

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It takes two to tango - those who take on debt are meant to do some basic calculation that they can repay it (and that the asset they are buying is actually worth it).

The fact that house prices were bid up beyond rational valuations is down to the general madness of crowds (and the prevailing pressures on them) as it is to do with the extension of easy credit. Of course the banks know this and keep pushing their product, wishing they could turn over the entire housing stock at inflated prices. Morons continue to oblige them.

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That statement seems to have stirred up a hornets' nest on the Guardian website, and I can't see much wrong with it. I thought it was now fairly common knowledge that this is what happens.

Just think! Would it not be possible for the Greek government to pop in for a quick loan to one of their banks? Would the Northern Rock have gone bust if all they had lost were some numbers they had made up themselves?

Is the Deputy Governor of the Bank of England, Paul Tucker, an 'idiot' for writing similar 'drivel'?

"Subject only but crucially to confidence in their soundness, banks extend credit

by simply increasing the borrowing customer's current account, which can be paid away

to wherever the borrower wants by the bank 'writing a cheque on itself'. That is, banks

extend credit by creating money."

http://www.bankofeng...7/speech331.pdf

Only a central bank can do literally that. Retail banks must first borrow the money (e.g. by taking a deposit), *and* keep sufficient capital in case you fail to repay the loan. That is the law. You may want to look up the definition of the reserve ratio. It would be completely pointless to maintain something like that if all they lent were some funny numbers.

To reiterate, any money you borrow from a bank will be either somebody else's savings, or borrowed from the central bank against some asset.

It is a fundamental misunderstanding to claim that the (retail) banks are somehow responsible for the money creation process, or that they have set up a system to suit themselves (in respect of money creation, anyway). Exactly the same creation can happen in a society that trades by exchanging chickens for sea-shells, or indeed when you sign a post-dated cheque. The banks help, but there is no way of banning the money-creation process unless you ban people from signing contracts with each other as well.

The author of the article does not know the first thing about the topic. He may be capable of quoting from respectable sources, but that is no good without the ability to understand the quoted text. He really should stick to something that does not require knowledge he does not have. Just how insane does he need to be to think he has discovered some sort of a major conspiracy? I expect the evidence of his abilities that is available to him would make that seem rather unlikely.

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Promises of money != money.

When you give a bank your money, you are swapping it for a promise of money. If you don't want promises of money, but money itself, then don't give it to a bank!

...//.....

As for what money is, it certainly shouldn't be fiat money either. The government/BoE can't be trusted not to print, as is evident from this crisis. Money should be chosen by individuals in the market place, not by some liars in suits.

:blink: .

:unsure:

LIAR SUITS??

. :P

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Only a central bank can do literally that. Retail banks must first borrow the money (e.g. by taking a deposit), *and* keep sufficient capital in case you fail to repay the loan. That is the law. You may want to look up the definition of the reserve ratio. It would be completely pointless to maintain something like that if all they lent were some funny numbers.

To reiterate, any money you borrow from a bank will be either somebody else's savings, or borrowed from the central bank against some asset.

Banks maintain their reserve and liquidity ratios in the aggregate, but where the rubber meets the road they simply make an electronic double entry ledger entry in your account with them and viola, you can buy a Stradivarius. No need for them to wait for 8% (of the loan amount) more deposits to come in before you get your loan. So by way of this credit extension they have created money (which as you point out later is done all the time by any creditor/debtor relationship). The bank is on risk with your debt to them and if it is not repaid with interest they DO have a problem... but money has been created, make no mistake.

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Just think! Would it not be possible for the Greek government to pop in for a quick loan to one of their banks? Would the Northern Rock have gone bust if all they had lost were some numbers they had made up themselves?

Only a central bank can do literally that. Retail banks must first borrow the money (e.g. by taking a deposit), *and* keep sufficient capital in case you fail to repay the loan. That is the law. You may want to look up the definition of the reserve ratio. It would be completely pointless to maintain something like that if all they lent were some funny numbers.

To reiterate, any money you borrow from a bank will be either somebody else's savings, or borrowed from the central bank against some asset.

It is a fundamental misunderstanding to claim that the (retail) banks are somehow responsible for the money creation process, or that they have set up a system to suit themselves (in respect of money creation, anyway). Exactly the same creation can happen in a society that trades by exchanging chickens for sea-shells, or indeed when you sign a post-dated cheque. The banks help, but there is no way of banning the money-creation process unless you ban people from signing contracts with each other as well.

The author of the article does not know the first thing about the topic. He may be capable of quoting from respectable sources, but that is no good without the ability to understand the quoted text. He really should stick to something that does not require knowledge he does not have. Just how insane does he need to be to think he has discovered some sort of a major conspiracy? I expect the evidence of his abilities that is available to him would make that seem rather unlikely.

You appear to write with some authority on this, what are your qualifications? My admittedly limited understanding of the banking system, led me to believe that banks do indeed leverage their deposits through Fractional Reserve Banking and they do this by re-lending deposits electronically to other banks. Maybe someone else can clear this up?

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It takes two to tango - those who take on debt are meant to do some basic calculation that they can repay it (and that the asset they are buying is actually worth it).

Not the case. In total people can never repay.

The fact that house prices were bid up beyond rational valuations is down to the general madness of crowds (and the prevailing pressures on them) as it is to do with the extension of easy credit. Of course the banks know this and keep pushing their product, wishing they could turn over the entire housing stock at inflated prices. Morons continue to oblige them.

The only people who are morons are those who make any "repayments."

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Just think! Would it not be possible for the Greek government to pop in for a quick loan to one of their banks? Would the Northern Rock have gone bust if all they had lost were some numbers they had made up themselves?

Only a central bank can do literally that. Retail banks must first borrow the money (e.g. by taking a deposit), *and* keep sufficient capital in case you fail to repay the loan. That is the law. You may want to look up the definition of the reserve ratio. It would be completely pointless to maintain something like that if all they lent were some funny numbers.

To reiterate, any money you borrow from a bank will be either somebody else's savings, or borrowed from the central bank against some asset.

It is a fundamental misunderstanding to claim that the (retail) banks are somehow responsible for the money creation process, or that they have set up a system to suit themselves (in respect of money creation, anyway). Exactly the same creation can happen in a society that trades by exchanging chickens for sea-shells, or indeed when you sign a post-dated cheque. The banks help, but there is no way of banning the money-creation process unless you ban people from signing contracts with each other as well.

The author of the article does not know the first thing about the topic. He may be capable of quoting from respectable sources, but that is no good without the ability to understand the quoted text. He really should stick to something that does not require knowledge he does not have. Just how insane does he need to be to think he has discovered some sort of a major conspiracy? I expect the evidence of his abilities that is available to him would make that seem rather unlikely.

this is why there is indeed a big difference between CREDIT, and money, although many post they are the same and are treated as such.

You need nothing to settle a balance you have in MONEY.

You need your BANKER to settle a CREDIT you have with your bank....and the BANKER needs MONEY to do it.

Sure they can "Journal" some credits and move liabilites around, but money is supposed to be issued against a security, a thing, and the process is call monetisation.

Banks today monetise anything, including that which is monetised already.

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You appear to write with some authority on this, what are your qualifications? My admittedly limited understanding of the banking system, led me to believe that banks do indeed leverage their deposits through Fractional Reserve Banking and they do this by re-lending deposits electronically to other banks. Maybe someone else can clear this up?

deposit=money.

credit= promise we will settle the account on demand with money.

bankers treat money and credit as the same in some measures of money supply. They confuse you deliberately.

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  • 284 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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