Why Do We Let Private Banks Furnish The Economy?

[Injin]

I am not "under threat from the police". Are you? What for - what did you do?

Genuinely interested at why you feel under threat, because to me you sound like a lonely paranoid weirdo sitting on his own in a little room rabbitting on about how "they" are all part of a huge conspiracy which only you can see.

You don't wear a tinfoil hat, perchance?

Wjy do you pay your taxes?

Is it -

a) because you are more than happy to give any stranger cash on the off chance you might get something back later on

you are scared of what will happen to you if you do not

Oh and if that doesn't do it for you, denail boy -

What will happen to you if you do not pay your taxes?

---

btw

You sound to me like an idiot who is taking an obviously ridiculous position and then trying to get out of answering a simple question that will reveal him as being full of crap by attacking the questioner.

[kingsgate]

Wjy do you pay your taxes?

Is it -

a) because you are more than happy to give any stranger cash on the off chance you might get something back later on

you are scared of what will happen to you if you do not

Oh and if that doesn't do it for you, denail boy -

What will happen to you if you do not pay your taxes?

---

btw

You sound to me like an idiot who is taking an obviously ridiculous position and then trying to get out of answering a simple question that will reveal him as being full of crap by attacking the questioner.

Every civilised society has certain communal benefits paid for by taxation. In the UK we have hospitals, schools, roads, etc etc.

How would you pay for these things? Should everyone just pay for their own stuff, and f*ck those who cannot afford the price?

What about you, anyway? Do you live in a cave somewhere? Where do you live? Who paid for your schooling? Healthcare? Who empties your rubbish bin? Etc....

Unless you live on your own island, and grow / kill all your own food, then guess what? You depend on taxes too!

Seriously, would you rather everyone just built a good old fence round their homestead, and said "f*ck everyone else, I am not contributing a bean to anyone else's welfare? Really?

[DabHand]

I know the real reason why governments borrow money from banks at interest rather than print it themselves debt free, but what is the given reason? Have they ever explained why they do this? Presumably they have some PR justification for doing this beyond 'they just do and nobodies ever questioned it'?

People would rapidly turn their backs on a sham fiat currency that had no innate value. The innate value is that all money borrowed by the government has to be paid back and is therefore not "obviously" created from nothing and worth nothing. Banks get to earn interest on a almost dead certainty of a non defaulting borrower. This is the two way benefit of the arrangement.

Stepping back you could also assert that the arrangement stops the government printing the currency into oblivion in its never-ending social engineering quest. Something that has happened EVERY time a government has had direct access to its own printing press within a matter of years.

The current arrangement still devalues the fiat unit but the process is much slower. Why else do we still have inflation? Loans are rolled over and extended ad neuseam, the current central bank bailout loans against crappy collateral is just the next stage of the slow fiat death. These loans will be rolled over and over and never get paid back except by the taxpayer if at all.

[The Spaniard]

Stepping back you could also assert that the arrangement stops the government printing the currency into oblivion in its never-ending social engineering quest. Something that has happened EVERY time a government has had direct access to its own printing press within a matter of years.

Not true. For example Colonial Script and Lincoln's Greenbacks.

See: http://www.safehaven.com/article-8658.htm

I think that the exclusive, transparent, responsible and rigorosly audited issue of currency by government would be far easier to control than our recent, almost unconstrained commercial issue-on-demand.

[tegan]

People would rapidly turn their backs on a sham fiat currency that had no innate value. The innate value is that all money borrowed by the government has to be paid back and is therefore not "obviously" created from nothing and worth nothing. Banks get to earn interest on a almost dead certainty of a non defaulting borrower. This is the two way benefit of the arrangement.

Stepping back you could also assert that the arrangement stops the government printing the currency into oblivion in its never-ending social engineering quest. Something that has happened EVERY time a government has had direct access to its own printing press within a matter of years.

The current arrangement still devalues the fiat unit but the process is much slower. Why else do we still have inflation? Loans are rolled over and extended ad neuseam, the current central bank bailout loans against crappy collateral is just the next stage of the slow fiat death. These loans will be rolled over and over and never get paid back except by the taxpayer if at all.

So the given reason is that they don't trust themselves not to print the currency into oblivion? They don't sound very confident in their own abilities.

[Yoss]

Sneak around at night with a deep 10mm socket fitted to a cordless drill/screwdriver and you can easily take these signs down.

Hoard em in your back yard, then melt em into a nice big lump of aluminium - one sure-fire way to beat the recession.

That explains why all the drain covers and lead flashing off roofs in my area keep disappearing. This crime is on the major increase. So time to pop too B&Q get a drill and crowbar before the sheeple catch on.

[Bloo Loo]

Sneak around at night with a deep 10mm socket fitted to a cordless drill/screwdriver and you can easily take these signs down.

Hoard em in your back yard, then melt em into a nice big lump of aluminium - one sure-fire way to beat the recession.

Then they come back, replace them and stick another sign up warning you not to take the signs.

Seriously though, coming back to Uk after even a short break, I notice the signage everyware, starting at the airport- dont let kids within two feet of the baggage belt, no smoking, no abusive language, no kids on the luggage carts, no pets, no this no that.

horrid. Just go to any hospital and the whole lot is in 4 languages!

[Pindar]

Surely the root cause of the problem is the notion that interest should be charged on money that is in circulation. When all is said and done, money serves merely as a convenient means for exchanging goods and services. Without it, you might have to fix your neighbours broken window in return for some of his time mending your car or some such exchange. The problem comes when money is lent at interest and when the sum total of all goods and services gets grossly out of step with the amount of money in circulation. If a way could be found to facilitate a fair trade for all goods, services and commodoties without creating inflation then you will have discovered the holy grail of fiscal systems. Inflation and deflation has existed for thousands of years. You only have to go back to ancient Greece and Sparta to see how quickly their worthless iron money became devalued and how quickly governments bankrupted themselves by borrowing too much money for wars. What's needed is a universal entitlement system, based on credits. You could think of this as a bit like rationing during the war, or something like they have in Star Trek where all your needs can be comfortably met, including food, shelter and recreation. I don't see humans evolving to this level for maybe hundreds of years, assuming we survive.

[Bloo Loo]

Surely the root cause of the problem is the notion that interest should be charged on money that is in circulation. When all is said and done, money serves merely as a convenient means for exchanging goods and services. Without it, you might have to fix your neighbours broken window in return for some of his time mending your car or some such exchange. The problem comes when money is lent at interest and when the sum total of all goods and services gets grossly out of step with the amount of money in circulation. If a way could be found to facilitate a fair trade for all goods, services and commodoties without creating inflation then you will have discovered the holy grail of fiscal systems. Inflation and deflation has existed for thousands of years. You only have to go back to ancient Greece and Sparta to see how quickly their worthless iron money became devalued and how quickly governments bankrupted themselves by borrowing too much money for wars. What's needed is a universal entitlement system, based on credits. You could think of this as a bit like rationing during the war, or something like they have in Star Trek where all your needs can be comfortably met, including food, shelter and recreation. I don't see humans evolving to this level for maybe hundreds of years, assuming we survive.

Credits- excellent idea- however, I need more credits than you do cos Im on the telly a lot

[Injin]

Every civilised society has certain communal benefits paid for by taxation. In the UK we have hospitals, schools, roads, etc etc.

How would you pay for these things? Should everyone just pay for their own stuff, and f*ck those who cannot afford the price?

What about you, anyway? Do you live in a cave somewhere? Where do you live? Who paid for your schooling? Healthcare? Who empties your rubbish bin? Etc....

Unless you live on your own island, and grow / kill all your own food, then guess what? You depend on taxes too!

Seriously, would you rather everyone just built a good old fence round their homestead, and said "f*ck everyone else, I am not contributing a bean to anyone else's welfare? Really?

I see a distinct absence of an answer to my simple question. Calm down, there is no need to be so anxious.

I also see a lot of excuse making guff. Just admit you pay your taxes because you are frightened of what will happen to you if you don't. There is no shame in being afraid of violence, it's sensible. You pay because they scare you and they scare you because then you will pay.

If you really needed or wanted the things that they buy with the money they extort from you, they wouldn't need to extort it, would they?

[kingsgate]

I see a distinct absence of an answer to my simple question. Calm down, there is no need to be so anxious.

I also see a lot of excuse making guff. Just admit you pay your taxes because you are frightened of what will happen to you if you don't. There is no shame in being afraid of violence, it's sensible. You pay because they scare you and they scare you because then you will pay.

If you really needed or wanted the things that they buy with the money they extort from you, they wouldn't need to extort it, would they?

I am not going to *admit* to anything.

I am happy to pay my share of taxes in order that I live in a society like the UK, as opposed to one where you have to step over people literally starving in the streets.

No-one has threatened me or been violent towards me. And no-one will.

By the way, you totally ignored everything that I asked you.

[Pindar]

Credits- excellent idea- however, I need more credits than you do cos Im on the telly a lot

And there you've hit the nail on the head. It's all to do with how important we perceive our role to be in a modern "democracy". The visionary writers of Star Trek saw through the egocentric haze that is our current world, with human beings vying like rats for cultural seniority and financial superiority to their peers. This is all so unnecessary in a truly human culture, since we are all connected in some way, all interdependent and no person any more or less valuable than anybody else, well in theory at least. Its a nice concept but in reality, people will always gain an advantage over their fellows because we are not all born equal; my proposal would be to use technological advancement to iron out the obvious genetic flaws in the species which expose it to social inequality. Technology should serve and enhance us, not the other way around.

[Injin]

I am not going to *admit* to anything.

I am happy to pay my share of taxes in order that I live in a society like the UK, as opposed to one where you have to step over people literally starving in the streets.

No-one has threatened me or been violent towards me. And no-one will.

By the way, you totally ignored everything that I asked you.

I am sorry, your persistent denial of reality is tiresome. I thought we would go back to the question you didn't answer before I responded.

You have answered that you are happy to pay your taxes so that you don't have to step over homeless people. Ok, fair enough. Utter lies of course, you pay because you are scared of the consequences of not paying. Then you lie to yourself and say it's to help the weak. Complete craven cowardice. I'm amazed you can look yourself in the mirror. Whatever, have another question -

How much do you give to charities like shelter every year?

I'll tell you - nothing,

Stop fooling yourself, it's pathetic.

Edited January 5, 2008 by Injin

[Yoss]

Any civilisation judges itself, not by the living standards of richest in society but the living standard of the poorest.

However on that scale compared to mainland Europe we do very baddly, however compared worldwide we do quite well. What is really shocking is the % of our GDP goes into retaining that dream and that's all down to bad managment by successive governments.

Oh and don't mess with HMRC unless you have the cash to pay for some good accountants/solicitors. There are good reasons that HMRC put 100% fines + interest on what (THEY DEEM) you should have paid.

a) To scare the sheet out of you in to paying up

To inflate accountant/solicitor (taxable) fees

c) big big scary fines, because if people do take it to court 8-10 times HMRC lose!

Submit yourself assesment by the 31st of Jan or you will be liable in for a £100 fine + interest on the amount you owe.

Tax doesn't have to be taxing..."offshore the IR jobs and save the tax payers some money."

[Ah-so]

Surely the root cause of the problem is the notion that interest should be charged on money that is in circulation. When all is said and done, money serves merely as a convenient means for exchanging goods and services. Without it, you might have to fix your neighbours broken window in return for some of his time mending your car or some such exchange. The problem comes when money is lent at interest and when the sum total of all goods and services gets grossly out of step with the amount of money in circulation. If a way could be found to facilitate a fair trade for all goods, services and commodoties without creating inflation then you will have discovered the holy grail of fiscal systems. Inflation and deflation has existed for thousands of years. You only have to go back to ancient Greece and Sparta to see how quickly their worthless iron money became devalued and how quickly governments bankrupted themselves by borrowing too much money for wars. What's needed is a universal entitlement system, based on credits. You could think of this as a bit like rationing during the war, or something like they have in Star Trek where all your needs can be comfortably met, including food, shelter and recreation. I don't see humans evolving to this level for maybe hundreds of years, assuming we survive.

Interest on money is vital - it is how I get compensated for lending you money, the inconvenience of not being able to spend it, and the risk that you might not pay it back.

You are holding up a children's tv programme as the ideal state to which we should aspire and evolve to?

"If a way could be found to facilitate a fair trade for all goods, services and commodities without creating inflation then you will have discovered the holy grail of fiscal systems. "

Maybe, but you are not going to achieve it through totalitarian rationing and distribution or life on the Enterprise (notice how they evolved to such an extent that they have no need for lavatories).

"What's needed is a universal entitlement system"

We have one already. Those who work the hardest, produce the most, get the most "entitlement credits", which are often also known as "money". What you are actually proposing would just bring about the end of economic activity overnight.

[DabHand]

Not true. For example Colonial Script and Lincoln's Greenbacks.

See: http://www.safehaven.com/article-8658.htm

I think that the exclusive, transparent, responsible and rigorosly audited issue of currency by government would be far easier to control than our recent, almost unconstrained commercial issue-on-demand.

No, entirely true. Greenbacks were a one off limited run of unbacked fiat currency and were one of many notes and currencies circulating. They held value because they were finite in number and were trusted over and above many other state printed paper currencies that quickly lost value by being printed into oblivion.

Colonial scrip (l assume you refer to the Pennsylvanian pound?) was again only one of many paper currencies and effectively was used side by side and favoured over others like the Continental which like almost all unbacked currencies got printed into oblivion. The Pennsylvanian pound was backed by land, which gave it immense stability and that fact does not make it a true fiat currency.

Had it survived the politics and the civil war it would have no doubt been detached from land as some stage and promptly printed into oblivion by whatever incumbent populist government was at the helm.

It amazes me that you think ANY government, if allowed, would persistently decide not to print money now to spend on what it might think are very worthy causes, spreading the impact of that newly created money over a much longer period of devaluing any existing currency. Immediate gain, with deferred pain is hardwired into all of us. ESPECIALLY governments that only look as far ahead as the next election.

I know you are not naiive, think about it.

[DabHand]

So the given reason is that they don't trust themselves not to print the currency into oblivion? They don't sound very confident in their own abilities.

Bankers, rich men, global elite (whatever) dont see much benefit in having to up sticks and convert their wealth ahead of repeated and systematic currency failures. They control the government, ergo the government doesn't get to play it silly printing game.

Sure the system is still one of slow currency failure but upheaval every 50 years is preferable to every 10.

[tegan]

Bankers, rich men, global elite (whatever) dont see much benefit in having to up sticks and convert their wealth ahead of repeated and systematic currency failures. They control the government, ergo the government doesn't get to play it silly printing game.

Sure the system is still one of slow currency failure but upheaval every 50 years is preferable to every 10.

Ohh yes, I'm aware of the real reasons they do it - governments are as much a slave of their money masters as you or I. What I wanted to know was what the governments excuse for borrowing from private banks at interest was. It can't be 'We don't trust ourselves not to print the currency into oblivion so we borrow from banks at huge cost' can it? I've never heard the justification they themselves give, or has no one every asked them?

[Injin]

Ohh yes, I'm aware of the real reasons they do it - governments are as much a slave of their money masters as you or I. What I wanted to know was what the governments excuse for borrowing from private banks at interest was. It can't be 'We don't trust ourselves not to print the currency into oblivion so we borrow from banks at huge cost' can it? I've never heard the justification they themselves give, or has no one every asked them?

It's because they are servicing bankrupcy.

They ran out of gold in the 30's and are still paying it off.

[tegan]

It's because they are servicing bankrupcy.

They ran out of gold in the 30's and are still paying it off.

Government debts are perpetual yes - they can never be paid off. I'd love to ask the question of Gordon Brown or Darling though, just for the comedy value of what they'd say.

[laurejon]

Here he goes again, first with the "nothing really exists" rubbish, and then the stuff about people being threatened with violence for not using banks. I have never been threatened with violence, terror or assault by the staff of any bank. Special offers in the post, yes. Threats to kill me if I don't bank with them, no.

There is also nothing in the UK that makes it illegal for me to barter with another person for goods and services. He can fix my roof and I can pay him in chickens, so long as we both agree.

It's just that most people, most of the time, quite like there being a standard form of payment. Having to take a mixture of gold and silver coins, combined with bags of wheat, and other produce, whenever I go shopping, is unwieldy.

Sorry but in the UK barter is illegal and outlawed by HM Inland Revenue

[Pindar]

Interest on money is vital - it is how I get compensated for lending you money, the inconvenience of not being able to spend it, and the risk that you might not pay it back.

You are holding up a children's tv programme as the ideal state to which we should aspire and evolve to?

Hardly. By using it to illustrate the point, in a way people would relate to is hardly aspiring to wearing a shiny jumpsuit and taking orders from Captain Kirk.

"If a way could be found to facilitate a fair trade for all goods, services and commodities without creating inflation then you will have discovered the holy grail of fiscal systems. "

Maybe, but you are not going to achieve it through totalitarian rationing and distribution or life on the Enterprise (notice how they evolved to such an extent that they have no need for lavatories).

Interest on money is not vital, it is theft.

And what we currently have is not totalitarian? If I wanted to opt out of the system tomorrow, there would be so many obstacles in my way I'd say it was almost as if I was in an invisible prison. You can't buy land, you can't enjoy the fruits of your labour without being taxed to death and you are threatened at every turn if you try and make it in our wonderful world of monopoly capitalism. It's either their way or the highway, except the highway doesn't lead anywhere.

"What's needed is a universal entitlement system"

We have one already. Those who work the hardest, produce the most, get the most "entitlement credits", which are often also known as "money". What you are actually proposing would just bring about the end of economic activity overnight.

I think you've missed the point here. Your view of reality doesn't stretch into the realms of fantasy as mine does. I do hope that one day humans will evolve and realise that they have everything they could possibly need and there's enough for everyone. This antiquated notion of labouring for a crust is fatally flawed since different types of labour are rewarded inequitably. For example, a navvy building a railroad was under-rewarded given the contribution he made to our modern way of life, yet the city banker or the administrator who sits on his **** all day is paid a comfortably living for what, exactly? You must see that our current system and means of rewarding hard work is imbalanced and skewed towards certain types of work.

Edited January 5, 2008 by BarrelShifter

[laurejon]

The 'Barter' System – The Hidden Evasion — TaxationWeb (December 2005) by Julie Butler, FCA

The rural community has thrived on the concept (and reality) of the system of ‘Barter’ for centuries. In the majority of rural communities most of the population has known each other for generations and a large number of the inhabitants are related to each other and with that comes trust (or bitter disputes) – but let’s concentrate on ‘Barter’ and trust.

It is quite normal for ferreted rabbits to be swapped at the local butchers shops for pork chops, or for grazing to be exchanged for field maintenance. Hay bales can act as currency in return for building work, home made cakes and repairs to vehicles etc. All very innocent, rustic and encourages a paper free environment but this can underpin what can only amount to potential income tax, corporation tax or VAT non-disclosure or even fraud.

‘Contemporaneous’ accounting records

That might sound harsh but it is the hard fact. The dream of a paperless rustic society has to be shattered and simple tax legislation and the self-assessment requirement to keep good books and records intervenes. The enquiry specialists will explain the need to keep ‘contemporaneous’ records.

‘Barter’ is not exclusive to the country communities - it is happening in the urban and suburban communities as well, e.g. painting and decorating work in exchange for motor repairs, building work in return for legal services etc. Another, well-documented area is bartering in the advertising industry, where customers provide free advertising space to their advertisers. The opportunities are endless.

Market value and production of the sales invoice

Clearly the service or product provided must be at market value (Sharkey v Wernher) and a ‘contemporaneous’ sales invoice must be made with sequential sales/fee invoice number and date. The business records must show how the invoice was settled, perhaps via a drawings journal or by the settlement of a purchase ledger invoice. Advice regarding the recording of such revenue is given in the Inland Revenue Booklet ‘Self Assessment – A General Guide to Keeping Records’. To quote direct from the booklet:

'Even if you do not record these through a till, you will need to make a record at the time the transaction takes place of the goods taken or supplied and their retail selling price.'

Entertainment

It is important here to refer to BIM45020, Specific deductions: Entertainment: Expenditure which is not allowable. (Expenditure that is incidental is also not allowable). This quotes:

'Expenditure on business entertainment is not allowable as a deduction against profits, nor may a deduction be made for any expenditure, which is incidental to business entertainment.

Traders may obtain entertainment through ‘Barter’ arrangement in which their own goods or services are exchanged for hospitality. The amount to be disallowed is larger of:

- the value at which the transaction is recognised in the profit and loss account; and,

- the cost of the goods or services exchanged for business entertainment.'

Correct VAT treatment

The VAT invoices must not only be recorded in the correct VAT quarter but the correct amount of output VAT must be charged and reclaimed. There are actually bartering companies in the UK who offer bartering services to a whole range of businesses. This is a growing industry. Even in this complex corporate environment, the payment of VAT is always required.

Inheritance Tax (IHT) consequences

In the farming community (with the average age of a farmer being high) it is possible for (in all innocence) the majority of farming activities to be dealt with via a simple ‘Barter’ arrangement, e.g. grassland exchanged for farm maintenance. If the ‘Barter’ transactions are not reflected, the farm accounts might show almost no activity, how would this affect a claim for agricultural property relief (APR) under s.115 IHTA 1984? Could it be proved that the land qualifies for APR or BPR? Could it be proved that the trade of farming was being undertaken?

Capital Gains Tax (CGT) consequences

What if part of the above farmland was to be subject to development? Would the land qualify for business asset taper relief (BATR) for CGT?

In order to claim Rollover relief or Business Asset Taper Relief (this can lead to the magical 10% rate of Capital Gains Tax) it is essential to show that any of the farming assets are business assets, i.e. assets used in the business. If all the activities are sheltered via ‘Barter’ it is tricky to prove that the land is actually a business asset, if for example, a parcel of the land were to become available for development, it could be very tempting for the Inland Revenue to challenge whether this is actually a business asset used in the business because it is not supported by the business accounts and ‘contemporaneous’ records. This is another example where unrecorded ‘Barter’ could work against the taxpayer in the claim for reliefs.

IAS – what is the correct accounting treatment?

The Institute of Charter Accountants in England and Wales summarise the accounting treatment under IAS 18 as follows:

'Revenue is measured at the fair value of the consideration received or receivable. The consideration is usually cash. If the inflow of cash is significantly deferred, and there is no interest or a below-market rate of interest, the fair value of the consideration is determined by discounting expected future receipts. If dissimilar goods or services are exchanged (as in barter transactions), revenue is the fair value of the goods or services received or, if this is not reliably measurable, the fair value of the goods or services given up.'

Further to this the International Accounting Standards Board interpretation SIC – D31 states:

'However, a swap of cheques, e.g. for equal or substantially equal amounts between the same enterprises that provide and receive advertising services does not provide reliable evidence of fair value.'

Action by Tax Advisers

So what actions should be taken by tax advisers?

Clearly it is important to talk to clients to explain that undocumented and unrecorded ‘Barter’ is actually as dangerous and illegal as the ‘black economy’. Explain that innocent ‘Barter’ can actually jeopardise future IHT and CGT reliefs in the fact that there appears to be no business activity where in fact, there is! ‘Barter’ is found at all levels within our clients activities and the key has to be client awareness.

September 2005

Article supplied by Julie Butler F.C.A., Butler & Co, Bowland House, West Street, Alresford, Hampshire, SO24 9AT. Tel: 01962 735544. Email; j.butler@butler-co.co.uk.

Julie Butler F.C.A. is the author of Tax Planning for Farm and Land Diversification ISBN: 0754517691 (1st edition) and ISBN: 0754522180 (2nd edition) and Equine Tax Planning ISBN: 0406966540, published by Tottel Publishing.

[Bloo Loo]

I think you've missed the point here. Your view of reality doesn't stretch into the realms of fantasy as mine does. I do hope that one day humans will evolve and realise that they have everything they could possibly need and there's enough for everyone. This antiquated notion of labouring for a crust is fatally flawed since different types of labour are rewarded inequitably. For example, a navvy building a railroad was under-rewarded given the contribution he made to our modern way of life, yet the city banker or the administrator who sits on his **** all day is paid a comfortably living for what, exactly? You must see that our current system and means of rewarding hard work is imbalanced and skewed towards certain types of work.

Ah yes- working for a living- used to be known as "white mans curse" and it is- for those at the bottom or who do not gain satisfaction from their toil.

[Laughing Gnome]

profits from a nationalized bank? What a great oxymoron!

State owned businesses hardly ever make profits. They need to be subsidised by tax payers.

http://www.postoffice.co.uk/portal/po/jump...;catId=19400181

Because in Britain nothing ( except the GPO Telephone system ) was ever nationalised that was not already bankrupt, Rolls Royce for example, and Northern Crock.