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Do you know how money is created?

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    #122
    Iwasfrozen
    Registered Users Posts: 16,250 ✭✭✭✭Iwasfrozen


    pqdvdplayer wrote: »
    That's like creationists disagreeing with the evolutionary theory. Why would you disagree when its a completely justified theory. Give me your theory on how the wealth is actually fairly created?
    There's a difference between saying loans create wealth and loans cannot be paid off without creating more debt. Do you understand the difference?

    It's actually ironic that you are comparing me to a creationist when your theory is not accepted in mainstream academia.


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    #123
    Seaneh
    Banned (with Prison Access) Posts: 18,300 ✭✭✭✭Seaneh


    Knasher wrote: »
    I looked it up, it says I'm correct.

    Dictionary definition and real world reality are different though.


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    #124
    Iwasfrozen
    Registered Users Posts: 16,250 ✭✭✭✭Iwasfrozen


    pqdvdplayer wrote: »
    But the monetary payment that he received was at some stage a form of debt...
    That's quite a statement.


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    #125
    Seaneh
    Banned (with Prison Access) Posts: 18,300 ✭✭✭✭Seaneh


    Iwasfrozen wrote: »
    There's a difference between saying loans create wealth and loans cannot be paid off without creating more debt. Do you understand the difference?

    It's actually ironic that you are comparing me to a creationist when your theory is not accepted in mainstream academia.

    You've been ignoring what everyone has been saying, haven't you.


    Every time money is created, debt is created.

    Every time a bank makes a loan, money is created.

    It's a self perpetuation circle.


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    #126
    Seaneh
    Banned (with Prison Access) Posts: 18,300 ✭✭✭✭Seaneh


    Iwasfrozen wrote: »
    That's quite a statement.

    Except for the FACT that money is created by issuing loans...


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    #127
    Iwasfrozen
    Registered Users Posts: 16,250 ✭✭✭✭Iwasfrozen


    Seaneh wrote: »
    Except for the FACT that money is created by issuing loans...
    But loans can be paid off without creating more loans by saving money.


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    #128
    pqdvdplayer
    Registered Users Posts: 158 ✭✭pqdvdplayer


    YellowFeather wrote: »
    Well you don't have to give us "exactly". A few pointers would be a good start.

    I understand your points, but to argue against a workable and valid system without suggesting an alternative is just arguing for the point of it IMO.

    As far as short term fixes go, fractional reserve banking & debt based currency need to go. In the longer term, the government could take control of all national assets (gold, silver etc) and use these to back what ever currency is established. People could then borrow real money and pay it back with their labour. The difficulty in achieving this is how to go about decommissioning our current system because a radical change would render people's hard earned earnings worthless. It would therefore be practical to propose a certain date where anyone born after this date would be obligated to function under the new system.


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    #129
    daveohdave
    Banned (with Prison Access) Posts: 483 ✭✭daveohdave


    Cuius rei demonstrationem mirabilem sane detexi hanc marginis exiguitas non caperet.


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    #130
    Seaneh
    Banned (with Prison Access) Posts: 18,300 ✭✭✭✭Seaneh


    Iwasfrozen wrote: »
    But loans can be paid off without creating more loans by saving money.

    But the money you are "saving" to use to pay the loan was created through the issuing of debt in the first place...

    You might be debt free, but debt still exists because of that money.


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    #131
    who_me
    Registered Users Posts: 3,669 ✭✭✭who_me


    Don't know how money is created, but I do know where it goes to. In fact, if you get time to flow backwards - money would spring forth from the back of my sofa in surprisingly large amounts.. coins would hop up off the floor and into my pockets as I head off drunk to the pub... where I regurgitate alcohol into an empty glass and sell it to the barman. The world would work so much better, if time flowed backwards..


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    #132
    Iwasfrozen
    Registered Users Posts: 16,250 ✭✭✭✭Iwasfrozen


    Seaneh wrote: »
    But the money you are "saving" to use to pay the loan was created through the issuing of debt in the first place...

    You might be debt free, but debt still exists because of that money.
    Were is the proof of this? The BOE paper only states money is created when debt is created they don't go so far as to say all money comes from debt.


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    #133
    Yogosan
    Closed Accounts Posts: 172 ✭✭Yogosan


    Money isn't a thing. Money is an abstract term that we humans created for our own benefit. Money creation could be seen as growing tulips in one century, or printing paper in the next. It's purely abstract and it means whatever we believe it to mean.

    'Credit' comes from the latin 'credo' or 'credence', a.k.a. to give belief to. Money or credit is whatever we believe it to be at any particular time. We give credence to money, and that can stop at anytime if people stop believing in somethings value.

    Money is created on belief in somethings value, whether that thing is coin, paper notes or tulips.


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    #134
    Nino Brown
    Closed Accounts Posts: 1,507 ✭✭✭Nino Brown


    Iwasfrozen wrote: »
    But loans can be paid off without creating more loans by saving money.

    Okay you're the only person existence, you borrow E100 which was created, but you owe interest so you owe E110. That last E10 can only be repaid by you borrowing more because it never existed to begin with. But if you borrow that E10, you'll owe E11 so the debt can never be repaid in full.
    But now there's more people in existence, they all borrow E100, now most people can pay off their debt in full by trading and being productive, but as a whole the debt can still never be repaid even though most people can pay.


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    #135
    Seaneh
    Banned (with Prison Access) Posts: 18,300 ✭✭✭✭Seaneh


    Iwasfrozen wrote: »
    Were is the proof of this? The BOE paper only states money is created when debt is created they don't go so far as to say all money comes from debt.

    All fiat money is created by issuing debt.
    Most of it is created by commercial banks (loans) the rest by governments and central banks (bonds and loans).

    All money in the system we operate in is created through the issuing of debt.


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    #136
    Iwasfrozen
    Registered Users Posts: 16,250 ✭✭✭✭Iwasfrozen


    Nino Brown wrote: »
    Okay you're the only person existence, you borrow E100 which was created, but you owe interest so you owe E110. That last E10 can only be repaid by you borrowing more because it never existed to begin with. But if you borrow that E10, you'll owe E11 so the debt can never be repaid in full.
    But now there's more people in existence, they all borrow E100, now most people can pay off their debt in full by trading and being productive, but as a whole the debt can still never be repaid even though most people can pay.
    You're ignoring that money is really only a bargaining chip for produce so imagine I'm a farmer who borrows 100 euros. I invest that money in equipment and over time I sell a % of my produce to other people until I have 110 euros which I pay off to the bank.

    That 110 euros grew out of the ground debt free as a result of my productive labour. Essentially I'm paying the bank back 110 euros worth of labour. If everyone else does this the debt can be repaid.


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    #137
    Seaneh
    Banned (with Prison Access) Posts: 18,300 ✭✭✭✭Seaneh


    Iwasfrozen wrote: »
    You're ignoring that money is really only a bargaining chip for produce so imagine I'm a farmer who borrows 100 euros. I invest that money in equipment and over time I sell a % of my produce to other people until I have 110 euros which I pay off to the bank.

    That 110 euros grew out of the ground debt free as a result of my productive labour. Essentially I'm paying the bank back 110 euros worth of labour.

    And you miss the point entirely.


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    #138
    Iwasfrozen
    Registered Users Posts: 16,250 ✭✭✭✭Iwasfrozen


    Seaneh wrote: »
    All fiat money is created by issuing debt.
    Most of it is created by commercial banks (loans) the rest by governments and central banks (bonds and loans).

    All money in the system we operate in is created through the issuing of debt.
    Again there's a big difference between "money is created when banks issue loans" and "loans cannot be paid off without creating new debt."

    Correct me if I'm wrong but I don't believe the BOE paper covers that. This is a theory and a theory that isn't accepted in mainstream academia at that.


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    #139
    Nino Brown
    Closed Accounts Posts: 1,507 ✭✭✭Nino Brown


    Iwasfrozen wrote: »
    You're ignoring that money is really only a bargaining chip for produce so imagine I'm a farmer who borrows 100 euros. I invest that money in equipment and over time I sell a % of my produce to other people until I have 110 euros which I pay off to the bank.

    That 110 euros grew out of the ground debt free as a result of my productive labour. Essentially I'm paying the bank back 110 euros worth of labour. If everyone else does this the debt can be repaid.

    Yes, so that would make you one of the people who can repay their debt, but you are paying your interest with somebody else's debt, exactly like I described. So everybody has E100 in debt, but you trade your labour for somebody else s debt, allowing you to pay the principle back plus the interest. But it's a zero sum game, the debt remains, whoever bought your produce will need to borrow more to pay their debt.


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    #140
    YellowFeather
    Registered Users Posts: 2,294 ✭✭✭YellowFeather


    pqdvdplayer wrote: »
    As far as short term fixes go, fractional reserve banking & debt based currency need to go. In the longer term, the government could take control of all national assets (gold, silver etc) and use these to back what ever currency is established. People could then borrow real money and pay it back with their labour. The difficulty in achieving this is how to go about decommissioning our current system because a radical change would render people's hard earned earnings worthless. It would therefore be practical to propose a certain date where anyone born after this date would be obligated to function under the new system.

    Again, I hear you, but both of those suggestions are wildly impractical. You, yourself, have pointed out how steeped we are in our current system. Getting rid of debt based currency could not happen in the short term.

    And what you're talking about with governmental control of tangible assets in order to stabilise cash flow - I think the EU might have a few things to say about that.. It's just not workable.


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    #141
    Iwasfrozen
    Registered Users Posts: 16,250 ✭✭✭✭Iwasfrozen


    Nino Brown wrote: »
    Yes, so that would make you one of the people who can repay their debt, but you are paying your interest with somebody else's debt, exactly like I described. So everybody has E100 in debt, but you trade your labour for somebody else s debt, allowing you to pay the principle back plus the interest. But it's a zero sum game, the debt remains, whoever bought your produce will need to borrow more to pay their debt.
    No they don't. They can also pay off their debt and interest by saving their money the exact same way the first person did. As can the next person and the next person and the next person ad infinitum.


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    #142
    Nino Brown
    Closed Accounts Posts: 1,507 ✭✭✭Nino Brown


    Iwasfrozen wrote: »
    No they don't. They can also pay off their debt and interest by saving their money the exact same way the first person did. As can the next person and the next person and the next person ad infinitum.

    By saving what? If they have E110 debt and E100 cash they can save all they want, but compound interest will make the debt grow not shrink.


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    #143
    Iwasfrozen
    Registered Users Posts: 16,250 ✭✭✭✭Iwasfrozen


    Nino Brown wrote: »
    By saving what? If they have E110 debt and E100 cash they can save all they want, but compound interest will make the debt grow not shrink.
    By trading their labour as I've pointed out. Your concept that all money comes from debt is untrue because loans are not the only way money enters the market.


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    #144
    Seaneh
    Banned (with Prison Access) Posts: 18,300 ✭✭✭✭Seaneh


    Iwasfrozen wrote: »
    By trading their labour as I've pointed out. Your concept that all money comes from debt is untrue because loans are not the only way money enters the market.

    What other ways does it come so?


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    #145
    Nino Brown
    Closed Accounts Posts: 1,507 ✭✭✭Nino Brown


    Iwasfrozen wrote: »
    By trading their labour as I've pointed out. Your concept that all money comes from debt is untrue because loans are not the only way money enters the market.

    You're right, there's 3% of the entire money supply which isn't debt. Still not enough to pay the interest though.
    http://www.positivemoney.org/how-money-works/proof-that-banks-create-money/


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    #146
    Iwasfrozen
    Registered Users Posts: 16,250 ✭✭✭✭Iwasfrozen


    Seaneh wrote: »
    What other ways does it come so?
    The Irish government put €54,576,917,000 into the economy last year. The vast majority of this was raised debt free from tax payers and invested debt free into the economy.

    Positive money is hardly an unbiased source.


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    #147
    EoghanIRL
    Registered Users Posts: 4,080 ✭✭✭EoghanIRL


    Step 1: use boards
    Step 2:
    Step 3: profit


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    #148
    AngryHippie
    Registered Users Posts: 2,625 ✭✭✭AngryHippie


    pqdvdplayer wrote: »
    Yes there is. We can inform more people about this because most people don't even have a clue that they are being robbed. You'll find that once the majority of a population are informed, justice will soon follow.

    Underpants gnomes at their finest.

    As long as a majority of the population (in the first world) are able to provide a life for themselves and their families, they will keep paddling the boat.

    The majority of the population are in total ignorance about how any of it works, and are in horrific abject poverty working like slaves to provide the above.

    Human selfishness exists, and outweighs altruism, and so justice for the majority will never come.
    Just enough people get a win to keep a lid on it.
    Thats where it all falls down.

    I'm alright Jack, keep your hands off of my stack, bom bom bom bom bom Cha-Ching!


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    #149
    knird evol
    Banned (with Prison Access) Posts: 1,007 ✭✭✭knird evol


    OP are you qualified to lecture us?
    What are your personal achievements. Do you run your own business. Are you a success and have you made money yourself?

    Because human society, of which the monetary system is a component, is a success. For the whole - and also for the individual. The world ain't fair but it's exact.


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    #150
    AngryHippie
    Registered Users Posts: 2,625 ✭✭✭AngryHippie


    knird evol wrote: »
    Because human society, is a success.

    :rolleyes:Wow. :eek: Just Wow.:D

    Is this what you call a success?

    As a species we are probably one of the least successful on the planet.

    We have convinced ourselves of our own sophistication and persuaded ourselves with our own lies.

    As individuals, our only pursuit is happiness, and yet the number of people taking antidepressants just so they can face their existence on a daily basis is still on the rise, and the number of people that get crushed under the boots of the systems we have created to provide our "happiness" gets larger every time a new face arrives on the planet.

    We are the most pervasive, invasive, destructive, infectious, greedy and spiteful creatures known to have existed, yet for all those superlatives, we are also capable of amazing (to ourselves at least) works of creativity and charity.

    I dread to think what an advanced alien species would make of us, but I'm pretty sure we would guarantee our own extermination. (If we haven't already by the time they find us)


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    #151
    ToddyDoody
    Registered Users Posts: 4,421 ✭✭✭ToddyDoody


    Money was originally gold... Value was originally the barter system. The rest is history.


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