Subject: Re: TURMEL: On Social Credit vs Greendollars
On Nov 30 1995
in Article #116597 in Newsgroup can.politics,
huyert@qed.uucp (Timothy Huyer) wrote:
:John Turmel (johnturmel@yahoo.com)
wrote:
:
:: Again,
I don't care what you call the money coming out of the
:: banks' loan pipes. I just want you
to admit that it's connected to the
:: tap and that it's new money, not old
savings.
:
:: So I
think it's pretty clear that I did deal with the bank as a
:: piggy bank model that he describes.
I also show that the process of
:: passing the money through the piggy
bank over and over again to create
:: new IOUs and new deposit slips does
not create new money. There has to
:: be a tap.
:
:I looked over the diagrams that Turmel
made and they are completely
:correct. He is also absolutely
correct in that the piggy-bank (or
:reserves) contains $100 and that there
is no other cash to be found
:anywhere.
:
That was the
plumbing blueprint for the piggy bank model which
you agree with which had no pump. Again,
I just want you to admit that
the loans pipe is connected to the pump
and that it's new money, not
old savings coming out.
:
Turmel then argues, in effect, where, then, is the $900 loaned
:out? Simply, in other people's
savings accounts.
:
He just found
the cash not to be found anywhere!
: Note that for
the bank, assets are reserves plus loans, or $100 +
:$900 = $1000. Liabilities are deposits
(since that is money owned by
:depositors) =$1000. Liabilities=Assets,
a nice condition to have.
:
So what is this extra $900, if there is no cash to cover it?
:
That's a valid
question if your model doesn't have a pump. To
readers who have accepted the validity
of my pump connected to the
loans pipe, this just isn't a question
anymore. This extra $900 is new
money issued as loans from the pump.
And as long as
you keep trying to explain new money without a
pump in your design, you'll have trouble
answering your own question.
"Where did this liquidity come from?"
is a question which cannot occur
to people who have a pump in their plumbing
model.
:I
:have attempted to give a few explanations
for it which apparently have been
:lousy. I will thus try again...
He's going to
try to explain how they come up with new liquidity
without a pump once again. Remember, keep
the piggy bank model in mind
as he explains it. Then try the casino
bank model. It's always fun.
Remember, we can explain it by connecting
loans to the pump and he's
trying to explain how his pump-less model
creates new money too. So
here he goes again, dealing with the trickle
while the river runs by.
And he's going to have to rely on 1% or
2% of the money supply
represented by metallic and paper tokens.
:
The bank does not need to have cash to cover all of its
:liabilities; it has loans to cover the
rest. The borrowers do not need
:to always keep the money they loaned
as cash; at least some of it comes
:back to the bank and is deposited by
whomever is the end recipient of the
:money. So the money does not exist
physically, only in the data-banks of
:the bank.
: A reason
why the money does not need to physically exist as cash
:is because people do not want to have
all of their money in cash. Even
:I, poor starving student, keep some of
my money in a bank. Thus, banks
:only need to cover with cash that fraction
of money that people need as
:cash. Reserve ratios are thus,
in part, set to cover that expected cash
:demand.
:
I stress that
when Tim's talking "cash," he's talking the paper
and metallic tokens, the 1% or 2% of the
supply. He admits the bulk of
his money is in the form of computer emoney
bank credits.
:
Was there a tap that created this money? No. The only tap was
:the central bank, with the initial injection
of cash, in this case, $100.
:
So now he has
to explain how the banks create all that new
liquidity into our bank accounts without
a pump and how his pump-less
model teeters from liquidity movements
in the reservoir (runs on the
bank)
:What happens if people decide to withdraw
all of their deposits, i.e.,
:
I'm going to
skip this for several reasons.
They're not withdrawn
until deposited somewhere else. It's just
splashing in the pool. 98% of deposits
are moved from their current
account after the check has been deposited
to the payee's account.
What happens with the paper and metallic
tokens is really
inconsequential in a run on a bank where
98% of it's transfers are
between computer accounts.
Since Tim pointed
out the reserve ratio is now zero, I'm not
going to go further into discussion of
the liquidity preference. Since
98% of our liquidity is emoney and has
nowhere to go but to another
electronic account, all discussions of
runs on banks is but splashing
in the pool which has nothing to do with
the problems in the pump
house.
And it seems
the greatest problem is to get Tim to admit that
there is a pump in the house from which
is issuing real liquidity as
loans. He says they do it without a pump.
I say there's a pump. I'm
The Engineer.
:I confess that double-counting is my own
term, I had hoped that, since we
:were using a plumbing diagram, that it
might have greater pedagogical
:value.
:
You're the first
plumber I've ever heard say "Let's double count
the water."
: Further,
note that, if one assumes that charter banks have an
:apparent tap, as Turmel claims, and that
they create $900 out of nothing,
:
Matched to incoming
IOUs like casinos cashiers create new chips
out of nothing or LETS creates Greendollars
out of nothing...
:their balance sheet is now $1900 in assets
and $1000 in liabilities, of
:which, $1000 in assets is earning the
bank no money. This is a
:disequilibrium point and is not profit
maximizing.
:
No. The balance
sheet is not $1900 in assets and $1000 in
liabilities. Or NOT. Remember, I'd written
in my Oct 30 message:
: At the limit of the process:
:
FRACTIONAL RESERVE BANK
:
Deposits Interest(in) Loan Payments
:Depositors
|
|
|
:
|--------|-------------|------------|---------|
:
| |
| |---|---|
|
:
| |----|-------------|----| | DRAIN |
|
:DS100 | | $10
$90 IOU90 | |-------|
| Borrower
:DS 90 | | $9
$81 IOU81 |
| $0
:DS 81 | | $8
$73 IOU73 |
|
:DS 73 | | $7
$66 IOU66 |
|
:DS 66 | | $7
$59 IOU59 |
|
:DS 59 | | |
| |
|
|
: | |
| | |
| |
|
: | |
|---- ----- ----- |
|
:------ | |$100 $900
IOU900 |
|
:DS1000 | |
|
|
:
| | RESERVOIR
| |-------| |
:
| |----|-------------|----| | TAP |
|
:
| |
| |---|---|
|
:
|--------|-------------|------------|---------|
:
|
| |
:
Withdrawals Bank Expenses Loans Out
:
: So with the
original $100, the fractional reserve also allowed
:for total deposits to be $1000 and for
total IOUs to be 900 except
:that new money was actually issued for
those IOUs permitting all
:depositors to have access to their real
money, not *supposed* money,
:at the same time.
I restate your
point:
:their balance sheet is now $1900 in assets
and $1000 in liabilities, of
:which, $1000 in assets is earning the
bank no money. This is a
:disequilibrium point and is not profit
maximizing.
:
There were four
arrays of numbers with four totals.
IN THE ECONOMY: IN THE RESERVOIR:
DEPOSIT SLIPS
CHIPS
MARKERS
Downtown Local
DS100 |
| $10 $90 |
| IOU90 |
DS 90 |
| $9 $81 |
| IOU81 |
DS 81 |
| $8 $73 |
| IOU73 |
DS 73 |
| $7 $66 |
| IOU66 |
DS 66 |
| $7 $59 |
| IOU59 |
| |
| |
| | | |
|
------ |
|---- -----|
| ----- |
DS1000 |
|$100 $900|
| IOU900 |
There is no imbalance
in what happened, only an imbalance in what
Tim saw. I guess that if the banker counts
all the chips he's holding
in their safety deposit boxes here and
downtown and adds IOUs as
assets, it does add up to 1900 in assets.
It's just not
the way the Ceasar's Palace casino cashier would
look at the transaction. He'd say:
A guy came in
and deposited $100 to his safety deposit box and I
gave him a $100 deposit slip. Over the
evening, I loaned out another
$900 chips with the deposit of $900 in
markers. The $900 in chips were
deposited to their safety deposit boxes
and $900 in Deposit slips
issued.
My numbers are
DEPOSIT SLIPS
CHIPS
MARKERS
Downtown Local
DS1000 |
|$100 $900|
| IOU900 |
Now there's a
customer, Tim, who been shouting that there's an
imbalance in my books because he had noticed
that $900 in local chips
and $100 in down-town chips and $900 in
IOUs adds up to 1900 without
reason that deposit slips are another
form of money and just because
you use two levels of money for the same
apples doesn't mean there's
imbalance.
Look, sir. With
$1000 deposit slips, $1,000 in chips and 900
apples IOUs in my cage, $900 deposit slips
buy back $900 chips in your
box which buys back the 900 apples. This
leaves the $100 deposit slip
for the original down-town $100 chip where
you can go to cash out for
your 100 apples. My cage assets and liabilities
balanced.
What you saw
were $1000 deposit slips for what was in the cage
and in the cage you saw $1000 in chips
and $900 in apples and you
counted the chips as if they had value
too.
In reality, your
$1000 Deposit slips are worth $900 apples and
the original $100 downtown chips worth
100 apples.
Really. A chartered
bank would work without interest in exactly
the same way a LETS Greendollar bank does
now.
Yet I do appreciate
the confusion when banks double-count money
in with their other assets like IOUs for
apples when money is really
nothing but a chip of no intrinsic worth.
:: I conclude
that they pay all those expenses to fool people like
:: you into refusing the believe what
you see, that it's coming from the
:: tap, and continuing to believe that
because they worry about keeping
:: the reservoir full, it has to be coming
from the reservoir.
:: And given
the power banks get of okaying or refusing a loan from
:: the tap to needy borrowers, paying
the expenses looking like you need
:: to keep the reservoir full so that
the suckers don't know it's coming
:: out of the tap seems sell worth the
investment for total economic
:: control.
:
:I am starting to feel that you are relying
upon conspiracy theory in
:order to validate your arguments.
:
Unfair shot.
The fact that the levers of control on the liquidity
pump do indicate conspiracy to hide the
pump has nothing to do with
the discussion of whether the pump is
there, which I've been trying to
focus on.
But if that pump
is there and if it is connected to the loans
pipe, then the direction of that financing
to the war and security
services does in fact indicate covert
action by a few very wealthy
people to use money to rob the poor unto
genocide.
But whether I
believe that this genocidal control system is all
accidental or due to ineptitude, or whether
it's the tiger from a
Pandora's box that everybody's got by
the tail and can't quit or
whether there are a suicidal team of 50
malevolent billionaires
working feverishly to increase pollution
and environmental degradation
unto the extinction of life on the planet
and they their team's
winning, ability to discuss a way out
openly, loudly, persistently,
vociferously, leaves hope that the one
way out will be appealing to
the current loansharking rulers as it
is to me.
We're all on
Starship Earth together and when it goes, we all go.
:If there is indeed a cartel of
:money-lenders who are operating the system
as you suggest, then each and
:every member of that cartel has an incentive
to cheat, that is, to loan
:out more money and thus weaken the cartel.
:
Why should they
cheat each other when they have a license to
steal? Why should anyone be allowed to
disturb their license to print
money? Don't you remember my poem.
Creating money
accurately means TO HAVE THE PLATES,
The stamping of some paper into notes
best demonstrates;
Yet others would
object if you could print it up to spend.
But what if government would let you print
it up to lend?
If you could print
and lend a thousand out at ten percent,
You'd make a hundred interest on printing
that you lent.
But if you could
print up and lend a million out you'd get,
An extra hundred thousand dollars for
your fee on debt!
If government
stops using its own plates and comes to you,
A billion printed nets a hundred million
revenue!!
With everybody
being taxed to pay you interest,
Of all the scams in history, TO HAVE THE
PLATES is best!!!
Though never spending,
only lending, riches to await,
To all who with the plates become the
loan-sharks to the state.
And though to
join the few who thusly profit, one might dream,
Wake up to see we're all the victims of
their greedy scheme.
Though governments
of old ruled "Treasury run money plates,"
Without the interest to middle-men at
rip-off rates,
Today most governments
to banking industry have lost,
Control of money plates so interest is
now a cost.
To service debt
in ninety four, Canada's request,
A hundred'n eighty billion dollars paid
in interest.
We're taxed over
five hundred dollars each per month to pay,
For interest to holders of our plates
they gave away!!!
Based on recent
Fraser Institute figures that total debt is over
$3 trillion counting the $1.8 trillion
in government liabilities, that
means that every Canadian is losing over
$10,000 per year to interest.
Interest on money they pump to governments
all around the world where
they are feted as saviors in the process,
interest on money they pump
to industry who need access to raw materials
to get into the economic
game, and interest on money they pump
directly to debtors. The world's
an oyster when the law permits interest
and you're running the tap in
an arid environment.
I would think
that of all the conspiracies of rich men to profit
using government, what they can do with
banks able to hide their pumps
must be the one that nobody's is going
to talk and rock the boat
about.
Think about it.
A country gives you control of its nation's
plates on the condition that everything
you print, you must lend. And
you can take the interest. The spectacle
of nations everywhere
prostrate before consortia of international
banks should hint that
since your government is in with the crowd
bowing, there's a good
chance your government does what their
masters want.
In no other instance
other than in their pleadings to finance do
governments show such abject subservience.
And that's the way the game
will always be played as long as the control
of money pumps is left in
private hands.
Some ask if I'm
in favor of nationalizing the chartered pumps. I
answer that I helped deliver LETS mini-pumps
all around the world and
nationalization has nothing relevant to
do with tapping into the
Earth's abundance. Besides, I figure email-banking
will eventually be
offered by internet providers since it
needs so little security.
With Greendollars,
you're not getting money you can hide so a lot
of the security necessary in the emoney
systems they are trying to
have us use on the internet becomes unnecessary.
Interest-free keeps
the accounts in balance. Period.
:I will skip the
:game-theoretic analysis that goes through
this, although it is fairly
:trivial to establish a prisoners' dilemna
type game showing this result.
:For a real life example, note the dramatic
failure of the OPEC cartel in
:maintaining high oil prices, this resulted
because of cheating by OPEC
:members.
:
So why can't
you recognize the same prisoner's dilemma when they
are prisoners of their debts. "Gee. After
3 or 4 cycles, I'd stop
playing" you suggested. You don't stop
playing until you're a winner
at these rules or you lose it all.
Whether or not
to engage in usury enslaving your neighbors to
secure yourself is an answer to the debt
prisoner's dilemma. If you
don't play for slaves, you become one
yourself. And with everyone
trying to enslave you before you enslave
them with debts, there's no
sitting down with the group and reasoning
it out that we should all
stop playing 11 for 10, that we shouldn't
let them foreclose on our
capacity and that we make them bank it
for us at 11 for 11. One
borrowed for the banker's service charge.
:
In short, I reject a conspiracy argument.
:However, I could have mis-read Turmel's
arguments, and thus I would like
:clarification if conspiracy theory is
being used and if yes, how.
:
You reject the
word conspiracy. Billionaires don't get together
to plan to use their financial muscle
in concert to achieve more
profitable returns. Billionaire loansharks
with government at their
feet don't get together to plan to use
their money system to keep
their debtors enslaved. That 98% of the
humans on Earth are enslaved
by their debts to a life of idleness or
grinding toil is a clear
indication that it took organization and
funds to organize the rip off
of the whole world.
But after all,
this is no ordinary conspiracy of rich men. To be
this successful and this evil, it must
be a conspiracy of men who
control the only leashes on governments.
And the only leashes on
governments are debts. Only a conspiracy
of loansharks could buy most
of the world's governments into giving
up their pumps which dispense
life-giving liquidity. And anyone who
inherits a pump soon realizes
its money-making potential. Only a conspiracy
of loansharks could
attain such power. And it's not that hard
to be a conspiracy of
loansharks. After all, you have all the
money and resources to do
anything you want to try.
Seems everyone
can accept that some lone nut in his attic can
dream of ruling the world but not everybody
accepts that a group of
rich billionaires might be capable of
doing it from behind the scenes.
:: When you're
talking about a monetary system which has a zero
:: reserve ratio as well as zero interest,
zero unemployment and zero
:: inflation, nobody cares what the reserve
ratio can make the money
:: supply do in the inferior model.
:
:
:: It is
silly to say that making sure the collateral matches the
:: chips issued is a central bank issue
when it is an "every-bank" issue.
:: And errors in estimating values in
transactions are cancelled when the
:: valuation is done and the equity priced.
If the buyer bought too high,
:: he incurs such loss. The value of the
asset in the cage always remains
:: the same.
:
:As I have repeated, the size of the money
supply is controlled directly
:by the central bank.
:
It hardly has
to be controlled at all if you have velocity.
Everybody in the casino could buy in for
thousands and play $1 poker
betting $100 of action in an evening.
That's 10 times more chips in
circulation than were even needed. Talk
about too much money. But it
simply means that the velocity was .1,
one-tenth per chip. With
velocity, there can't be too many chips
other than the automatic rule
at the cage dealing with their issuance
relative to collateral.
:Agreeably, it is not perfectly controlled,
since
:reserve ratios are not constant, nor
is borrower/depositor behaviour.
:But the control is there.
:
Here he is again
talking about savers splashing their deposits
around when we passed the point long ago
that the reserve ratio is now
zero. It has better be constantly zero.
:The central bank, however, does not have
:perfect information, it does not know
precisely the real GDP of the
:economy at this moment. It has
statistical estimates however, and this
:causes error. The central bank
chooses to err on the side of positive
:inflation since this is better than too
little money.
:
Too little chips
in a casino simply means higher velocity and has
nothing to do with the value of the chips
at the cage. So a casino
cashier doesn't have to choose to err
like a central bank does.
:: So engineers
often find it easier to look at the flows which
:: represent 99% of the volume alone and
the real world analogy would be
:: for the banks to cease cash and only
allow checking. Then we'd have a
:: zero preference for cash.
:
:I am unfamiliar with the literature that
deals with the move towards a
:cash-less society, and so I can't comment
directly. I would speculate,
:though, that since there are multiple
charter banks, and that money
:borrowed from one bank might end up in
another, the charter banks must
:maintain strictly positive reserves,
deposited in the central bank, to
:cover the net transfers of money between
banks.
Because chips
from the Dunes might end up at the Flamingo is no
reason to maintain reserves.
:In this case, the
:reserve ratio would be very low, but
still strictly greater than 0,
:thereby bounding the money supply.
:
Tim's not talking
about the reserve ratio here. He's talking
about the amount held in reserve being
held low whereby the reserve
ratio is just a number which has been
picked and is not a function of
something else. And with the reserve ratio
now zero, stop talking
about bounding the money supply.
:: :but note that, given wealth w and environment
e, f(w|e) > 0 in
:: :general (and at worst is non-negative).
All that the analysis requires
:: :is that if F is the aggregate demand
for cash and W aggregate wealth,
:: :F(W|e) > 0 for at least some environments
e.
:: :
:: Sorry.
Here you lost me since you don't define the operator "|"
:: or the units for wealth (though ergs
would do) or the units for
:: environment (which I've never heard
of), or the units for demand for
:: cash. I can only paraphrase how I tried
to read it:
:
:Whoops, mea culpa. I tend to get
excited with my math and forget to
:explain it.
:
Given w := wealth, e := a particular environment (i.e.,
:non-wealth factors that determine demand
for cash, such as, but not
:limited to, planned purchase of items
with cash), f(w|e) is the demand
:for cash CONDITIONAL on an environment
e (I took the notation from a
:stats book, but it does not excuse me
for not explaining it). In other
:words, fixing a certain environment,
the demand for cash is dependent
:only on wealth.
:
My argument was that, whereas charter banks could easily see how
:wealthy people were, simply by checking
deposit book balances, they could
:not accurately predict what environment
the depositors were in. They
:thus make estimates about demand for
cash, and thus, for the banks, F(W)
:is perceived as a random variable, where
F(.) is aggregate demand for
:cash and W is aggregate wealth.
:
You're still
talking about the desire for paper or metallic money
you want to leave the bank with. That's
only 2% of the bulk.
:: And now
that the analysis got what it required, what does it end
:: up saying? All I said that was 99%
of money is e-money in chartered
:: banks computers and that the study
of the demand for 1% in cash was
:: not of major utility.
:
:But proves that banks want strictly positive
reserves, which bounds the
:money supply.
:
Which proves
that the money supply is bounded by whatever the
banker feels like tying it to. What a
bank wants should have no
bearing on what the money supply should
be.
:Also shows how changes in environment
can change demand
:for cash, and, thereby, necessary size
of reserves. 1% might be small,
:but it still plays a significant role
when one is dealing with the limit
:of a series.
:
Sorry. I disagree.
When how much of the money supply people want
to leave the bank with as tokens represents
only 1% or 2%, it is not
significant. That financial splashings
within the 2% of the bulk are
what constitute runs on the bank, I can't
agree. There may be runs on
individual banks but not on the system
since emoney must always be
deposited to another account first.
As long as 98%
of the money, the emoney, may only go from one
account to another, I'm little interested
in runs on the token supply.
:: Making
the volume of your loans dependent on savings is a
:: ridiculous control system. In LETS
with a zero reserve ratio, the
:: volume of chips issued into today's
game has nothing to do with the
:: volume of chips saved from yesterday's
game. It has only to do with
:: the collateral you have on you or your
credit.
:: Isn't
this a beautifully tricky way to disguise a casino model
:: tap banking system as a piggy bank
no-tap model and have it react to
:: the outside world in exactly the same
way a piggy bank would. "Alas,
:: there's no money left in the piggy
bank. We can't lend."
:: One guy
looking for a solution who peeks through the slot at the
:: top into the inner plumbing of the
piggy bank screaming "Hey, I can
:: see a tap" is not what they're particularly
happy about.
:: But if
finding a tap to fund environmental repair, to fund
:: infrastructure repair, sick-bay repair,
engine repair, then scream
:: "Here's the money tap" I'll forever
continue to do.
::
:: Throwing
in another example of how major societal problems would
:: be saved when everyone gets their own
interest-free credit card, let's
:: take my example.
:
:Turmel's example reveals what is called
"imperfect capital markets".
:It however, is not sufficient to make
the entire financial system garbage.
:
Imperfect capital markets result because:
:(1) of uncertainty. I cannot,
nor can the bank, predict accurately,
:what my future earnings will be.
In fact, since I could die in a couple
:minutes, I cannot even predict how much
labour I am capable of providing
:(income would be the value of that labour,
since it is pretty obvious
:that there are certain things I cannot
do as well as others in the same
:time).
:
This is a standard
predicament whether you are dealing with the
interest bank or the LETS Greendollar
bank.
:
If I am loaned more than I am worth, than I will go bankrupt.
:
No. As long as
you're still breathing, you can score positive by
honoring the Green Hours your spent with
your offer to work.
No. If you were
worth $20,000 and you borrowed $100,000 to buy a
new house, you'd now be worth the original
$20,000 and the $100,000
house to balance your new $100,000 marker
in the cage.
You must remember
that the purchase of any major asset really
doesn't affect your financial score. You
owe $100,000 more
Greendollars the day after you move in
but it's balanced by the
$100,000 house you're holding. You're
still basically worth the same
$20,000 the day after you come into possession
of your new $100,000
home.
Now if in 10
years the house has depreciated to $90,000, (in an
interest-free world, things that get older
and used up go down in
value) if you've managed to repay $30,000
on that debt, it just mean
that your net value would be the original
$40,000. If I had paid only
$5,000, I would be worth $15,000. Let
all your life's financial
transactions be through one account and
it's easy to understand that
you aren't declared bankrupt for being
negative, you're declared
bankrupt for being negative when you die.
Till then, you still get
credit to try whatever is being left untried
if the resources are
being unused.
:The bank obviously does not want this
to happen, so it will try to reduce
:its risk by reducing how much it is willing
to loan.
:
So because the
present system is apt to over-lending and
bankrupting people out of the game, it's
better to reduce their loans.
This is untrue.
11 for 10 is the same problem whether you got the
loan for $100 or for $90.
:Because of risk, it
:will loan, on average, less than an individual
is worth.
:
Because LETS
sees no risk other than termination of life, the
LETS attempts to loan, on average, as
much as an individual is worth
and prefers not to err.
:(2) Incentive to repay. If
I am using my labour as collateral, I could
:very simply default. Simply, I
choose to not work, or, if I do work (and
:the collateral is hourly based) work
poorly.
:
Yes. But now
you're guilty of what the involuntarily unemployed
are accused of. Of breaking your pledge
to the group to honor your
Time IOUs with equivalent service.
:
Note that I have already received the loan -- this is sunk.
:I will be getting no value from my labour
since it goes to repayment.
:So why repay?
So why repay?
Such a question is foreign to someone whose need
was supplied from another's abundance
with no haste for its return.
Tim, we're not telling you that we will
demand you do the promised
work to the detriment of your schedule
so that you refuse. We're
asking to try to put back what you took
out of society's larder before
you die.
Sure, we've had
guys like you who asked "Why repay?" and took off
after we served them without repaying
in kind but not many were asking
"Why repay" before we were serving them.
And why do people
in the real world model, LETS, repay the
Greendollars they've spent by accepting
them for their own work.
Perhaps it's as little as the respect
of one's peers and the
friendship of people have have learned
to rely on your honor. Honoring
one's commitments is fulfilling and gives
a sense of self-worth while
might be so rare that once people try
it, they like it and don't
bother completing the theft of time.
It's easier to
stiff someone who asks you to repay money you
don't have than to stiff someone who asks
you to repay time you do
have.
:
Historically, one could indenture oneself, i.e., effectively
:become a slave if you default.
Similar style apprentice-ship programmes
:also existed (and for a scathing critique
of them see Adam Smith's
:_Wealth of Nations_). The former
has been (rightly) abolished, the
:latter inefficient.
:
The real problem
was that there were more slave-ship programs
than apprenticeship programs. Historically.
Slavery has NOT
been abolished. A slave is one from whom the
fruit of his labor is removed. Whether
by chains or by financial
trickery.
And in the Third
world today, there are actual indentured debt
slaves. There are reports in the press
every year on slavery. Give
every slave an interest-free credit card
and ask him what he's going
to do.
And debt slavery
has persisted far longer than chain slavery in
the annals of history.
:As a digression, this is why there is
a govt guaranteed student loan
:programme. Since I can default
on a loan but not as easily on taxes, the
:govt assumes much less risk than the
bank does -- i.e., the govt is not
:at (as much) risk from me cheating them
(being the sneaky and dirty guy I
:am!). So govt guarantees student
loans since banks would not be willing
:to provide them otherwise (which would
lead to an inefficient market).
:
But why do the
banks classify you and your co-students as
inefficient markets in the first place?
And why do you take it? Are
you not the best and the brightest? Why
do you take bankers betting
that you're losers so quietly?
:Turmel proposes that something similar
to the student loan system be
:expanded. Note, however, that his
models are as much in danger as the
:current system -- what is the value of
my labour, what is my risk of
:defaulting -- and thus do not solve the
problem.
:
Your risk of
defaulting is minimal without dying. Only the sick
and the slow will be of such little utility
that they leave the game
with heavy negative scores on their credit
cards, and for whom I
don't mind chipping my thirty millionth
share from every Canadian's
account to balance the loser's score.
If you choose
to be an idle bum and end your life with a negative
score-card like the sick and the slow,
it still won't slow those who
choose to work and trade to augment their
life-styles. I'm saying that
whether you're sick, retarded, or lazy,
those of us who think scoring
by producing things is fun will use our
robot technology to produce a
cornucopia of abundance even our sick,
retarded or lazy cousins can't
handle.
Worrying about
credit limits in a world of abundance disappears.
Though it's a game where the richer cousin
can end up driving a Rolls
Royce, but's also a game where that only
happens when the slower
cousin is driving his minicar on credit
if the minicar is there to be
used. Or his Rolls Royce on credit if
no one else has chosen to use
those Rolls Royce's over there.
It's almost exciting
thinking about the freedom an interest-free
bank account would give you. Freedom from
financial coercion. The boss
better treat you right or you can take
a break while you look
elsewhere or retrain for something else.
But what I seem
to have dwelled on most recently is how the
interest-free credit would affect the
producers and consumers as each
become the other up to 100%.
10,000 indigent
Ottawa families use their interest-free credit
card to purchase every free home in town.
Remember that property goes
to one side of their ledger and debt to
the other so that they can't
borrow too much as long as they've got
the collateral in tow.
They'd spend
new IOUs furnishing their new housing. These are
also small-depreciation items which won't
cost much credit.
They'd spend
new IOUs on food, clothes, entertainment. There'd be
lots of goods going to the poor replaced
by
their monetary IOUs.
As merchants
start selling more goods, they start ordering more
stock and paying with those monetary IOUs.
Manufacturers
get more orders for goods and have to hire people
to do the work.
People who owe
for their recent support now have the opportunity
to settle their advance with their labor.
It's just like
the wampum IOU system of the Great North American
Indian civilization. Everybody in town
takes your IOUs and uses them
as chips until the day you earn your IOUs
back.
:
If I might anticipate Turmel, he might counter by providing
:examples of how LETSystems evade this
problem. However, the LETSystem
:would not be sufficient. An example:
:
If I were to study at MIT, tuition alone would be $28 000 US per
:year. Assuming I live reasonably,
let's say that it would cost me $38
:000 US per year, which I, not having
sufficient wealth, would have to
:borrow. Letting interest rates
= 0, with 4 years we are now talking $152
:000.
:
But getting your
first year's $38,000 at an interest rate of 10%,
Exiting your
first year, you'd owe
$38,000(1.1) = $41,800.
Exiting your
second year, you'd owe
($38,000 + $41,800)(1.1) = $87,780.
Exiting your
third year, you'd owe
($38,000 + $87,780)(1.1) = $138,358.
Exiting your
fourth year, you'd owe,
($38,000 + 138,358)(1.1) = $193,993.
If I promised a LETSystem that I would repay that 4 years of
:education with an equivalent value of
labour, who is to say that my
:labour is worth $152 000 (some would
say that it definitely would not be
:since I am studying economics!)?
And instead of
owing $150,000 my way facing any number of years
in which to repay, you're facing $194,000
with $19,400 as the
interest payment for your first year out
of school.
If you just managed
to pay just the $19,400 interest every year,
year after year, forever, your would $19,400
payments applied directly
to the principal means you would have
been debt free in 8 yearly
payments.
What was an insurmountable
obstacle of growing debt became a debt
which could be handled by most graduates.
These words will
come back to haunt you the next time one of your
fellow students leaves the game by suicide
over financial problems.
Growth of non-exponential debt for goods
and services is benign.
Growth of exponential debt for no reason
is not.
:And what would happen if, after being
:educated, I choose to default, even if
I could afford to repay the loan?
:
Here he is back
wanting to leave the game being ranked with the
sick and the slow. You may not get to
drive a Caddy like a worker or
buy a mansion like a worker or vacation
around the world like a worker
but your credit for anything that is not
being used by someone with a
positive credit line may certainly go
to the drones with negative
ones.
But who wants
to leave a fair game with the score-card of a
drone. So the problem of people absconding
to not honor their time
debts is quite insignificant.
:
Note that the value of labour is important. A lot of resources
:would have to go into teaching me, and
the issue is whether I am worth
:those resources, not whether I am worth
the 4 years I spend in that
:school. The proverbial ditch digger
is unlikely to generate $152 000 US
:of wealth in 4 years, and thus fixed
labour repayments are not sufficient.
:
Attempts could be made to prevent the risk of my choosing to
:default, but even if they are 100% successful,
they do not cover the
:issue as to whether I was worth that
education.
:
But if the teacher
was there and if we're ready to accept your
IOUs from you even if you die negative,
why shouldn't the idle teacher
register some time useful time, even if
only seen in your eyes, so
that you acknowledge to the system at
some point, "let me pick up her
tap for some of her car, I owe her." It
means that she has more
positive number and you have more negative
number but it doesn't hurt
society to serve her in exchange for her
positive contribution. If
we'll take the marker from the cripple,
we'll certainly take it from
the teacher.
Imagine that
the working generation are simply earning the markers
of the next generation and hope their
markers are remembered when it
comes time for them to be cared for.
Applying Christ's
law of abundance from Paul Corr II 8:14:
Your generation's
abundance should at the present time be a
supply for their want to that the later
generation's abundance may be
a supply for your want.
That's what's
scariest. Banks loansharming the savings of the
older generation to the younger one. I
know of rich families who lose
money because junior pays 15% at the bank
for his loan and senior gets
10% for his deposit. It splits generations
like it splits marriages.
:
Case in point. If someone told me that that $152 000 US would be
:covered by a mere 4 years of labour (and
during those four years I would
:obviously have to maintain minimal consumption
levels in food, shelter,
:etc) I would jump for it. I would
be willing to be indebted a lot longer
:for that education, but, unless the market
forced me to, I wouldn't admit
:it (hopefully, the market doesn't read
my posts!).
:
Using the option
of paying it off at $19,400 per year over 8
years allowed you to be free of your debt
where otherwise, you'd have
been a debt slave for the rest of your
life. And I'd bet that even if
it took 8 years or 10 years, or 20 years,
it doesn't matter as long as
you realize that you got what you're paying
for.
If you think
that your education by these specialized men was
worth trading 32 years to get, that's
your decision and can be handled
in an interest-free world though spending
$600,000 in four years would
be quite on the indulgent side.
I hope you realize
the magnitude of what's at stake if Tim gets
his interest-free or interest-bearing
student loan. Forced to go to a
loanshark, he can just make his interest
payments and stay afloat for
the rest of his life and for the same
payments, in a linear world,
he'd be out of debt for that education
in 8 years.
:So, if the problem was only imperfect
capital markets, neither solution
:would correct that. Unfortunately,
there are additional problems which
:necessitate positive interest rate lending
which I have tried to cover
:here and in previous posts.
:
It's the use
of the word "necessitate" which bothers me. Just
because it's written in an economics book
that something is necessary
doesn't mean it's necessary in the real
world, only in the economic
world.
Tim says that
interest rates are necessary to solve certain
problems. I see LETS and casino chips
which have no problems and have
no option but to suggest that his cure
is his cancer. Like the doctors
of old who believed in bleeding the patient
to health, the economic
analogy applies.
:
This does not mean that current attempts to correct the imperfect
:capital markets are sufficient either.
I would argue the opposite in
:fact. In fact, I would argue that
ideas like the LETSystems can help, in
:limited ways, to correct some of the
inefficiencies and suffering caused
:by imperfect capital markets. I
merely state that LETSystems et al can
:not replace in entirety the current system.
:
I say that a
LETS which can handle a database of 100 records or
1,000 records or 1,000,000,000 records
can fully be offered as a real
world software upgrade to replace the
current system in its entirety.
:: And I ask
:: are they lending out the whole 10 of
the depositors savings as you
:: show in your piggy bank model or do
they lend out 10 new dollars out
:: of the pump as I show in my casino-bank
model.
:
:And I answer
:they are lending out the whole 10 of
the depositors savings.
:
If you're lending
me the depositors savings, where's the new
money you say you've just created if not
double-counted. Upon this
rock, that the loans are from the tap
not the savings reservoir it
looks like we must disagree.
Seems kind of
silly that such a trivial situation can offer two
such contradictory explanations. I say
it's testament to the
brilliance of the scam.,
:: And that
was my whole point. Then the central bank reserve ratio
:: was merely a minimum and they issued
2% and the chartered banks issued
:: 98%. Now the chartered banks can issue
as much more as they want no
:: matter how much the central bank issues.
It I was arguing that 2% was
:: too small to really dwell on and your
pointing out that it's now 0%
:: sure completes my point.
:
:Once again, please check my arguments
for why the reserve ratio is
:strictly positive.
:
Wait a minute.
You said that it was now zero. Positive or
negative have no relevance.
And note that any series from n=0 to infinity
:a*(1-r)^n has a finite limit, a/(1-r)
for any r, 0 < r < 1. Regardless
:of how small the reserve ratio is, as
long as it is strictly positive,
:the limit holds, and therefore the money
supply is fundamentally
:determined by the size of a, which is
set by the central bank.
:
Yes but a is
now zero. And the other factor in the determination
of the money supply is if the banker feels
like it or not.
:Turmel then talks about the notice on
loans before a bank can call them
:in, such as 1 year mortgages. As
long as the borrower's credit is still
:viable, there is no reason to not renew
the loan.
:
Except where
the interest rate went up and your viability of
meeting those increased payments went
down correspondingly and they
say no. Those are the news stories I'm
talking about. When they say
yes and let the loan live, there is no
news story.
:If the borrower's
:credit has changed, the interest rate
might change to reflect the new
:risk (interest can decline if risk declines)
or the loan may not be renewed.
:
Exactly my point.
The credit-worthiness of you and your
collateral is a function of interest rates
set by the controllers of
money. If the rate goes down, you and
your asset's credit-worthiness
goes up and if the rate goes down, so
does your credit-worthiness.
Notice that without an interest rate to
reflect the value of your
worth up and down, most people are worth
what they've got added to
their score-card. Most buildings are worth
the workmanship that went
to them. That can fluctuate due to supply
and demand but any change is
always reflected at the cage.
If you borrowed
100,000 chips to buy your house, always
promising to cover the depreciation, I
have your IOU marker for
$100,000 and you have the $100,000 chips
which you exchange for the
house.
If next year,
someone offers you $120,000 for the house and it's
only depreciated by $10,000, he sees something
of greater value and
he's willing to part with more hours to
get it so I take his marker
for $120,000 and he gives the $120,000
to you who pay me the $10,000
for the depreciation, the $100,000 you
owe and you net $10,000. If you
covered depreciation with repair yourself,
you make a net profit of
$20,000 on your investment.
That kind of
price inflation will always exist. I call this
supply and demand though. I reserve the
word inflation for the
artificial price rises forced upon manufacturers
who have to include
interest in the price of their goods.
: This
is done to reduce the risk to the bank. A new business is
:expected to lose money for its first
few months. However, if it does not
:improve or if it is losing too much money,
then the lender does not
:wish to watch his or her loan vanish
into a pile of debts.
:
But the initial
risk of failure is introduced by the rule of 11
for 10. That's what creates the initial
shortage that leads to a
fraction of the participants failure and
foreclosure. It leads to
everyone being so desperate for tickets
to survive that they will
resort to fraud, theft, violence in order
to survive. So when they
assess the risk of your being a loser,
they are themselves creating an
original minimum number of losers.
:: Why are
you dealing with what goes on in the reservoir of
:: savings? We don't have reserve ratios
anymore. You said the control
:: had been cut between savings and the
reserve ratio of loans. You can't
:: talk control after saying you now have
zero control. With no reserve
:: ratio, there is no savings governor
on the pump.
:
:I said, and I thought quite clearly,
that there is no minimal reserve
:ratio maintained by law. There
are still reserve ratios, maintained
:voluntarily by banks because it is in
their profit maximizing incentive
:to do so. They keep the reserves
to meet demand for cash etc.. See
:above and previous posts.
:
So they're still
measuring something that's been disconnected.
But it's a dial that still may offer useful
information. But it has no
effect when zero savings are necessary
to issue a new loan.
:I will also go back to a point that can
easily be lost in the model of
:the banking system. Why do people
borrow money?
:
They borrow money because (1) they believe that they will be able
:to repay that money plus interest and
(2) they want that money now rather
:than later.
:
They also want
that money because it's the only way to get into
the game and the only way to survive physical
necessity. Seems a much
more powerful inducement than "they want
that money now rather than
later." Perhaps they need that money now.
:Case in point, me and my education.
If I invest my future
:labour earnings in education now, I will
hopefully be able to repay those
:labour earnings plus interest.
:
And all we're
asking you do do is the same thing without
interest. And if the only reason you're
suggesting that interest is
necessary is to cover the bums who are
going to stiff their loans, I'd
say that your averment of your hopeful
intention to repay both the
principal and the interest would also
serve demand for the averment of
your hopeful intention to repay at least
the principal.
My way, a lot
less students will fail to honor their promise.
:In addition, I hope that the education
:will raise my future labour earnings
sufficiently more than they would
:have otherwise been in order to leave
me with additional profit.
:
So do I so your
account can rise out of debt faster as your
production increased.
: Now, if
I thought I was going to be worse off from borrowing
:money, I wouldn't have done so.
:
You know you're
worse off with respect to the house in your
original deathgamble but you're betting
that you'll be one of the
survivors. You know that you're badly
off with interest but you're
worse off with the loan. So you think
you're forced to accept badly
off with interest to get the loan when
in reality there is a way for
you to access loans without interest.
:Note that here I am referring to utility
:rather than money. But simply,
if my expected discounted future utility
:conditional on no education (and hence
no borrowing) is higher than that
:with education and borrowing (and repaying
that debt and interest) than I
:do not borrow.
:
This is all just
the descriptions of problems for participants
within the deathgamble. Questions of who
survives. When it's not a
deathgamble and everyone survives, whether
you were credit-worthy
enough to borrow and gamble will not arise.
:
Obviously I would be willing to borrow more (or be more willing
:to borrow) if the interest rate was less,
but there is scarcity out there,
:and I have to accept certain limits.
:
The other big
bonus of keeping the tap hidden. It permits Tim, in
a world with stores bursting at the seams
with proffered goods, to
believe that there's real scarcity he
must endure. This is done by
to chase the dollar instead of the good.
When dollars are kept
in short supply, he thinks there is scarcity
in supply.
This is a great
myth. A few posts ago, I pointed out a report
which indicated that we'd only started
the harvest the minerals in the
earth's crust and the agricultural potential.
If it is correct in
saying that we have the potential to feed
35 billion on an American
diet, then we have the immediate potential
the stuff the present 5
billion of us with good food within years.
But remember
that as auto garages are forced to keep their
inventories lean to avoid interest charges,
so do grocers forced to
keep their inventories low as well.
As the garage
waits for immediate payment before ordering the
product, the food industry keep their
inventories low awaiting payment
before ordering from farmers.
It's the difference
between the Earth always having a 6 month
reservoir of food and having a reservoir
of food that grows as fast as
possible. We tend to discourage the growing
of food and other life
support industries on the grounds that
there is no foreseeable market
for that food from people who are starving
and broke. So they don't
grow it.
Stopping food
production because the warehouse ran out of
receipts for it is stupid and stopping
food production because the
banks run out of money tokens for it is
just as stupid.
:The interest rate is the
:equilibrium point for the demand for
borrowing versus the supply of money
:-- i.e. resources -- willling to be lent.
:
Yes but we've
agreed that with a zero reserve ratio, the pump is
free to lend out as much new liquidity
as it wants. So with
sufficiency of money, interest as a premium
for scarcity of money,
disappears.
:: :The correct criticism, which I adopted
:: :later, was that the 11 for 10 dilemna
was irrational.
:: :
:: And what
you can't face is that it's prime rule of what's going
:: on within every mort-gage death-gamble
signed anywhere on the planet.
:: It is irrational to continue going
to the interest-bearing money pump
:: when you can go to the interest-free
Greendollar pump.
:
:Rather, if I expected to lose from borrowing,
I would not borrow.
:
But you earlier
admitted that when you borrow 10 expecting to
repay 11, you expect to lose. So why do
you borrow? You say you do not
borrow and yet you say you do though admitting
expectation of loss.
:Hence,
:any model that argues that I borrow and
lose and expect to lose is
:irrational -- it says I will do something
that I will not do.
:
You can't say
you will not do it as you do do it by signing your
name to the promise to pay 11 for 10.
You do it. Don't say that my
model doesn't expose you doing it when
you've admitted that you do do
it. You do borrow 10 to owe 11. You think
it's normal.
:Thus, a
:new model, one which makes it rational
for me to borrow, is required.
:
What better way
to model everybody getting 10 dollars and owing
$11 than everybody getting 10 toothpicks
and owing 11? Or 10 chips and
owing 11? You can't get a better model
than right on. You keep looking
for a model that can keep you confused.
:Either one needs to come up with a model
that will fool all the people
:all of the time (and I would be very
interested in how this is), or a
:model in which I do benefit, on average,
from borrowing.
:
My models allows
you to benefit from your borrowing just like the
current models.
All the reasons
you gave me why you should be trusted with the
loan at interest were just as good reasons
for you to be trusted with
the loan without interest.
But he's still
living under the rule that he can't get anything
out of the loan pipe without paying interest.
So he sees the benefit
he out of the loan as a benefit of having
paid his interest. Unusual
comprehension, even from a slave.
:: :A simple way of testing the rationality
of the 11 for 10 game/dilemna, is
:: :to invite ten people over, play the
game several times, and find out how
:: :quickly it takes before people exercise
the option of not playing.
:: :
:: Make
them all put up their bus-passes and once hooked, there's no
:: way out but to play and hope you're
a winner rather than a loser in
:: the death-gamble.
:
:Let me repeat. Explain the game
to the players. Tell them, you either
:play or don't play. If you play,
you put up $10 dollars and get 10
:tokens. Make the game perfectly
random so skill is not an object. Tell
:each player, if you get 11 tokens you
get your $10 back, if you get less,
:you get $0. We will allow that
players all have enough money to play and
:lose the game several times.
:
TEST: Can you
determine the fraction who get knocked out of the
game from Tim's explanation of the model?
:
See how many people choose to play the game. Play the game (and all
:people choosing to play will try to get
11 tokens), and then repeat the
:whole thing again. I will guarantee
that there will be fewer people
:playing the game and quite likely zero.
:
That's what I'm
guaranteeing too. That after every cycle of the
11 for 10 game, there are fewer borrowers
who survive to play again
and there are soon likely to be zero.
:
In other words, the best way to win the game is to not play.
:
He's made a good
case for the problem faced in the 11 for 10
game. The best way to win the game is
to not play and bring your
collateral to the 10 for 10 bank if you've
got one.
The problem he
can't accept is that to not play deathgamble often
means to not survive. No job, no money,
no life-support. That can
kill.
But even now,
I've got him and his friends hooked.
All 10 of them
borrowed 10 and all 10 owe me 1 per year minimum
or more if they want to pay down their
principal. If he can pay off
the whole 11, great, if not, just the
1 in interest will do.
Let's say that
in their first cycle, five guys end up with 11 and
five guys end up with 9. Four of the five
winners take cash out their
11 and leave the your party game with
their bus-passes. The other one
who could cash out and the other five
who can't pay their interest.
With 50 chips
back in the cage and 6 bus-passes, that leaves 50
chips out in the casino. I, the banker,
now think "I'm up one bus
pass."
Cycle after cycle,
they give me one or score enough to buy out
and survive. Finally, it's "No problem"
no more as the last two hand
over their last chip. They've got one
more cycle with no chips in the
game to come up with the interest or else.
:So WHY, in Turmel's model, do people consistently
choose to play?
:
No, it's not
in my model that they're choosing to play. It's in
the real world where they're choosing
to play and Turmel's model
simply demonstrates what is expected to
happen to those real people
which the model is modeling.
:Game
:theory says they won't.
:
Game theory says
they do. Or rather, with game theory one can
show that they do, how many will be eliminated
and how many watches
will disappear from the cage backing up
the chips.
:Empirical evidence says they won't.
:
Empirical evidence
says they do. Ask any accounting prof is bank
loans are obtained under the 11 for 10
rule. Every bank you see is
empirical evidence that people do choose
to play, even if coerced.
:So what
:principle lets the model ignore both
theory and reality?
:
So what if there is no other game. I still have two options:
:play or don't play.
:
Play or don't
play. Play or starve. How many times do you not
choose play. Starvation seems not a high
frequency choice.
:And my expected pay-off from not playing
is higher
:than from playing.
:
Well, yes, you
lose less interest but you also lose your life. I
know questions of financial losses are
weighty considerations but
don't quite rate up there with questions
of physical survival.
:
In fact, let us weaken Turmel's model further.
:
No, let's not
weaken my model. Let's change some parameters and
see if the model handles them.
:Instead of the
:fixed payouts, let the payout be $(tokens/11).
People will still choose
:to not play the game, although it might
take them a bit longer to realize
:that they are best off not playing.
:
The irrationality in the model is that the players are
:consistently choosing to go against their
own best interests, i.e.,
:behaving irrationally.
:
Can I really
criticize you for being so irrational as to sign
your own mortgage deathgamble when you
had no other choice but to
gamble on being one of the survivors?
:: Being
better off without the loan because it avoids the interest
:: is not really better off if your kids
are starving. The only time
:: you're better off without the loan
to not pay interest is when you've
:: already got enough. But it's true that
if the rich man doesn't need
:: money, he's not forced to borrow any.
:
:So why borrow, then, to buy a house,
car, or anything besides food?
:
Because you need
that past resource now and you have the manpower
to replace its value later. And if getting
the loan of the past
generations spare resources makes you
stronger, in general, we all
have more.
There is good
reason the older generation to support the younger
generation but not middled by loansharks.
:One
:can rent a house, thereby avoiding the
mortgage "gamble", and so on.
:
You pay interest
on the structure within your rent. There's no
escaping it. Increased prices due to interest
is everywhere.
:I
:repeat, if one thinks that the loan is
going to make one worse off (and
:again, I speak in terms of utility) than
one does not take out the loan.
:
Most people asking
for a loan don't think it's going to make them
worse off unless they understand the nature
of interest. Utility of
loans is a given under either system.
:People do not start out indentured; I
only became indebted when I
:voluntarily took out student loans.
Now I would have loved to avoid that
:necessity -- i.e., to have free education,
or to have had interest free
:education.
:
Free, no. No
one deserves a free ride. But interest-free, yes.
Everyone deserves chance to pay it off.
I do feel empathy
for Tim's predicament though. He might owe
$30,000, $40,000, $50,000 for his education
and with the front-end
loaded interest charge, he could be dragged
down by it for a major
part of his life. And, no matter how rich
he might eventually get,
that would be part of his life where is
most needs money and when it
will hurt the most.
Wouldn't it actually
be nice if they only came to collect after
you were dead. You have your earnings
card and your spendings card and
when you die, they open them up and see
if you came up a winner or a
loser in a fair game of harvesting abundance.
:Course, I would also love to have free
food, free housing
:(and make that a big house), a free Ferrarri,
and so on.
:
Just because
you linked free money with interest-free credit
doesn't mean I'm offering you free food,
free housing, etc., in the
least. With the original offer of the
credit, you can have that food,
but you'll try to return its value someday.
We're counting. You can
have that housing but you'll pay the depreciation
on it someday. We're
counting. Not loansharking, not charity
but right in between. Loans we
want back but without the loanshark's
interest.
:Course, so
:would everyone else. Who gets what
-- those willing/able to pay!
:This does not mean that poverty is inevitable,
necessary, or even
:desirable.
:
Poverty is inevitable
if 11 for 10 continues to be charged.
Interest is at the root of the cause of
the shortage. And only in
Economics could the desirability of poverty
be taken into account.
:I personally think it stinks. However,
in order for a
:solution to eliminate poverty, it must
also be a feasible solution.
:
That's why you
should be ashamed of yourself for not seeing that
a LETS Greendollar bank account is a major
step in the solution to
your personal poverty. Instead of facing
a life of financial scarcity
with dread, you could be facing a life
of abundance with financial
considerations relegated to an auxiliary
service offered by our
internet providers.
You can't get
more feasible than a software disk in hand and
press reports of the success of the upgraded
money system from around
the world. I'll repost some of the Greendollar
press for those who are
hearing this for the first time.