Subject: Re: TURMEL: On Social Credit (24 pages)
On Nov 21 1995,
in article #114196 in Newsgroups: can.politics,
firstname.lastname@example.org (Timothy Huyer) wrote:
:The first point that caught my attention
is Turmel's fixation with a
:shortage of money.
Fixation with the prime criteria is not unusual among engineers.
Anyone who plays mort-gage death-gamble borrows 10 and owes 11. I
think the automatic shortage of money as the prime rule in the game
would make that shortage of money the most likely idea to be fixated
It's only when you believe that inflation is Shift A (see
Mathematics of Usury Analysis which follows,) more money chasing the
goods, and you fail to perceive Shift B, the same money chasing less
goods, that you can believe that there is too much money.
The fact that every dollar born of a banker's pen must be
returned with more is quite persuasive in explaining why interest
causes an artificial chronic shortage of money.
:In particular, it seemed that Turmel felt
:if not all, economic problems could be solved simply by printing more
Tim, you're so trained to believe that there are no solutions and
hence any proposed solution is wrong that you haven't even realized
that we're talking about two possible solutions here, not just one.
The old Social Credit solution and, for want of a better name, the
Friendly Credit solution.
What you just said I wanted was the Social Credit solution which
you yourself dubbed the "banker adds chips to each pot" solution to
paying the extra interest owed. After 20 exchanges on the Social
Credit versus Friendly Credit Greendollar theme, you should know that
eliminating the interest and stabilizing the debt, not the money, is
the way I want to go. They're two different solutions for you to
When I sought a model to show the problem with paying the
interest, you came up with a model which had the banker adding an
estimated amount to balance the interest.
The problem with both Tim's banker adding to each pot and with
Social Credit governments adding chips into circulation by government
spending and merchant discounts is that they both have to estimate the
imbalance caused by the interest demanded and compensate for it. My
way is to eliminate the imbalance and not have to compensate.
If everybody took out their loans at 20% instead of 10%, they'd
have to manage to estimate how much more was needed for every pot.
Of course, my solution of eliminating the interest imbalance at
the source means that we don't need the Social Credit balancing act.
It stays in balance all the way.
What's funniest in this is that when first confronted with the
problem of every player owing more than every player gets which Tim
calls "irrational" though we suffer under it, really, is that in
trying to come up with a solution, he himself comes up with the same
old Social Credit solution of trying to balance the interest. Their
balancing acts would have worked.
So though also solved the irrational dilemma by adding chips, he
can't bring himself to believe his own logic when it concurs with the
logic of every farmer trying to pay 11 for 10 had to. Reality for that
farmer was that he was mired in an irrational contract where he had to
come up with 11:10 every year. And no one was hypothetically adding
chips to his pot though it made sense when a Socreds said they would.
It made sense to everyone faced with more debts than their loans
that their government add chips directly to their pots as a National
Dividend. They were short, giving them some made sense.
So Tim, as I hope you see, both the National Dividend to each
citizen and the manufacturer's rebate are Socreds trying to add chips
to every pot to try to balance the increase in prices due to the
interest in the same way you offered.
I guess you could say Social Credit National Dividend and you
adding chips to our pots is reactive to the interest plague while
Green and Time Credit systems are proactive. They kill the usury
plague dead. They eliminate the exponential interest charge by
replacing it with a linear service charge. Like switching components
in the economic engine. Slide out the Bretton-Woods Usury software and
load up the Greendollar software. Try out the Social Credit software
if you really want to continue having interest which you'll have to
balance off all the time but most will soon choose that stable money
makes for the smoothest ride.
:In effect, since the only physical requirements
for money is
:paper and ink (and, technically, not even that), and, since if the
:physical requirements became binding we can simply change the
:denominations of the money (i.e., a $100 bill uses the same materials as
:a $2 bill), a central bank can literally produce an infinite amount of money.
Pretty good argument for linear service charges for our loans.
Now we pay $100 on the $1,000 transaction and $100,000 on the
$1,000,000 transaction. Every year. I'd rather pay the $15 service
charge one for both.
:Under those circumstances, if the economic
problem was _simply and only_
:lack of money, Turmel would be correct in criticizing current economic
And if it's only part of the problem, why would I not still be
correct in criticizing economic systems? Why does the problem have to
"_simply and only-" the lack of money and not just a component of the
problem. Shall it be discarded because it doesn't solve everything all
at once but only one small part of the market mechanism? Actually, it
does solve everything all at once.
Give me access to a global Greendollar account and I'll retire
from all political and economic activity, my personal engineering
project accomplished. I won't even run in my 40th record breaking
political election. That's how much getting an interest-free global
Greendollar account is the only thing on my mind. That you must also
end up with an interest-free credit card to use or not at your
discretion is a healthy by-product of my endeavor.
I hope you don't think I'm infringing on Rockefeller's property
rights by giving you an interest-free credit card so you'd don't need
to borrow from him at interest.
And again, make the distinction between the old Social Credit
solution to lack of money which is to balance the growth of the debt
with more money, your banker-adds-chips. The new Greencredit solution
is to eliminate the imbalance in growth of debt in the first place
eliminating the artificial shortage and making more money unnecessary
when there's always just enough.
However, it is not money which is the problem; it is the amount
:of goods and services which can be purchased. These are finite, and
:demand is non-satiated, infinite. This is where scarcity occurs, not in
:the money supply.
To say scarcity occurs in nature and therefore not in the money
supply needs remedial Boolean algebra. Scarcity can and does occur in
both real life and in the money supply. One is real, one is
artificial. Looking at the real scarcity will not help you in your
examination of the artificial one we're discussing here.
For example, let the economy consist entirely of 10 watches and
:let there be 100 tokens representing the entire money supply. Thus,
:there are 10 tokens per watch, and in this very simple example, that is
:the price of each watch.
The perfect example but let's call them chips because that's how
it's done in a poker game. The banker lends them all 10 chips per
Now double the money supply. Are people wealthier? No: since
:only 10 watches can be bought, the watches rise to 20 tokens each in
Wrong. If the chip supply doubled, there had been be 20 watches
in the cage or else. My 10 chips better always be worth my watch or the
Casino Supervision authorities will be immediately notified. I think Tim's
assuming an equitable doubling. If the new chips were shared out
equally, I could handle my watch going to a value of 20 chips instead
of 10. But if some benefit out of changing the value of money more
than others, then I'd rather we stick to the rule where a cashier who
"double's the chip supply" continues to be fired and sent to jail.
Before the chip supply could double, the watch supply had to double
This is a standard flaw in economic methodology. Economists seem
incapable of retaining the linkage between the chips issued and
collateral taken in at the cage.
But in real life, if my watch does rise from $10 to $20 in value,
is it that same watch that went up in value or was it that the watches
have risen to 20 "Half-tokens" each for no rise in value at all?
What does "double the money supply" really mean?
Does the casino cashier give everyone a share of the new chips or
does he dump them onto the casino floor where players scramble for
them? Do the operators pocket the new chips and introduce them into
I think Tim's assuming an equitable doubling implying they're
breaking even. But it makes a difference on spending patterns if the
doubling of the money supply is shared or stolen. I don't ever see
poor people's lot improving when the money supply doubles so I deduce
rich people usually get all the benefit.
Introduce a second good, say 5 televisions, and let the equilibrium
:be, arbitrarily, with 100 tokens, that each television is worth 10 tokens
:and each watch 5. In other words, each television is worth two watches.
:Doubling the money supply does not affect the relative worth of the
:television -- it is still worth two watches.
This is the point I was making about the relative price of treats
like chocolate bars, chips, cones staying relatively uniform. If
doubling the money supply every few years has a benefit to someone, it
doesn't seem to be me.
So it's just as easy to pay for a television with 2 watches
whether money has gone up or down, but middling the transaction with
money costs interest which is not now taken into consideration.
Thus, real prices, or the relative price between goods, does not
:change when one changes the money supply.
If it's fair. But if the new money is issued to some businesses
and not others, they can compete with better equipment and have better
prices while the non-preferred have to compete with whatever they can
which is less than optimal. Because your doubling of the funds is not
spread out uniformly, prices will rise due to inefficiency as well as
:Thus, without loss of
:generality, we can actually ignore money altogether, and value all goods
:in terms of watches. The good designated as the base good for prices is
:called the numeraire.
And for Tim's exclusive use, we'll use the example of Tim's
Casino where the numeraire for his chips is standard $100 (10hrs
labor) watch. As long as everything has a price in watches, I'll use
: It should be
clear that with n goods, designating any one good
:with non-zero value as the numeraire creates an n - 1 dimensional simplex
:from which the general equilibrium markets can be established. This
:methodology was first proposed by Leon Walras about 100 years ago.
Sure, designating running shoes with $50 value as the numeraire
would create a simplex (list) of new prices, most doubled. If it used
to cost one watch, it now costs two sets of running shoes.
: In other
words, money is simply a method of making the barter
:system between goods more efficient. Money acts as an intermediary.
But money screws up when it tries to become one of the
commodities which it is not.
What happens, then, if the money supply changes (say increases)
:and nothing else?
The cashier goes to jail. If he hasn't added collateral to the
safe, he's off to jail. It's as reliable as that.
Isn't it funny how economists just can get it that if the law
says there's going to be no inflation because chips will always match
collateral or else, there can be no inflation or else we get new
cashiers until it does. It's the reason they don't teach about chips
linked to collateral in Economics.
:The prices of goods relative to one another
:constant, but relative to money, increases. In other words, inflation.
But no worse off if I got my 10 new chips for my watch. Such an
inflation which wouldn't hurt as much as inconvenience.
The inflation in real life is the one which has the benefits
diverted to a few while the destitute are made worse off.
Estimating the effects of policies on the rich is not as clear as
estimating the effects of policies on the poor. This year, the Ontario
Government slashed 22% life support from the weakest of the weak to
allay the financial fears of the strongest of the strong. When one
considers that over 50% usually goes into rent, that's like slicing
half the money for physical needs. What a crushing genocidal blow to
the poor. There will be increases in crime and violence in the
streets, misery and suicides will hit new highs. Over a bank computer
software bug with an upgrade ready to go for years.
This is all independent of how money is created. Turmel argues
:that, since money is created through debt, the amount of money that must
:be repaid is always greater than what exists -- another possible case for
:a shortage of money.
I've never complained about "money created through debt." That's
an old Socred misexplanation that I've not only ever used but that
I've spent years trying to correct.
I might have complained about "debt for money never-created" but
never for "money created through debt" because I think money created
through debt is as good as money created through credit. It's the
interest that makes each grow which is the problem.
Example: Good Debt Money
Let's say Canadian Tire Stores have 1,000,000 credit account
holders and let's say that they all owe on average -100.
Example: Good Equity Money
Let's say that a consignment store or casino cage accepts goods
so that everyone who leaves product has on average +$100 on deposit.
If they were to offer transfer checking privileges so that I
could transfer and and now owe them -120 so you'd owe them -80, again,
we simply equity swapped while everyone is positive.
So whether money is based on debt or credit, it's always good as
long as it's value is fixed at the central cage where it was issued
and new debt or credit is issued at that same rate.
Old Socreds decry "Debt money" for two reasons. Socreds expected
their government to issue money like Tim's banker added chips to the
pots and this money could cover government expenses. It was not owed
to the banks and was not "debt money" in their eyes and they therefore
concluded that since "non-debt-money" was good, therefore "debt-
money" was bad. All money is good, only interest is bad.
I had commented earlier that new money is created by the central
:bank, the monetary authority, through open market transactions. Turmel
:argued that this was not sufficient.
No, I argued that the Bank of Canada's contribution was
insignificant and that the discussion was not on the Bank of Canada's
tiny contribution but on the hefty bulk from the private banks.
However, let the reserve ratio that banks maintain be r,
:0 < r < 1. The reserve ratio is the ratio of reserves to deposits.
:All other money is loaned out,
This is false. This was the whole point of whether depositors
savings come from the tap or whether they come from the savings
reservoir. After quelling any question that it wasn't coming from the
tap, here he once again has forgotten about the tap and says that
depositors' funds are loaned out from the reservoirs. People aren't
getting savings deposits, they're getting loan deposits to the
accounts. Therein lies the confusion.
:the loans are then spent on some
:transaction, and the person receiving the transaction deposits the entire
:value of the transaction back into the bank.
Usually, the person receiving deposits the check first and it
comes out next. But this is still just splashing savings deposits
around. What's important is what's going on at the tap and the drain.
: Assume the central
bank buys a bond for $1 from the bank and credits
:the bank's account $1, i.e., $1 of new money is created. The bank keeps
:$r in reserves, loans the rest out.
Notice again, he's lending out the rest of the depositors
savings, like in the piggy bank. We went over this. His piggy bank
does not create money. It comes out of a tap and he needs a tap.
:That loan money is then eventually
:re-deposited in the bank. The bank adds r*$r to its reserves, and loans
:out the remainder, and so on.
No, it doesn't loan out the remainder. It loans out a
corresponding amount of money from the tap. Without a tap, you can't
come up with new money.
:As was noted in earlier posts by Turmel
:(and confirmed by e-mail to me and a quick check of a math text) the
:total amount of new money created is $1/r.
My model with a tap created this amount of new money but his
model only created this amount of new IOUs, no new money.
:Note, though, that the amount
:of money that the bank has on reserves is $1, or r*$1/r. Thus, if new
:money is only responsible for 2% of the money supply, as Turmel claims (I
:have no actual figures myself, perhaps Turmel can explain where the 2%
:figure came from), the bank's reserve ratio is thus also 2%.
That's right. It was was taken out of "The Deficit Made Me Do It"
by Dr. John Hotson, University of Waterloo Economics, Dr. Harold
Chorney, University of Concordia Political Economy, Dr. Mario
Seccareccia, University of Ottawa Economics
It all depends on the different reserve ratios for the different
M1, M2, M3 classification of chips used by bankers. M1 are the chips
instantly available in the casino or from safety-deposit boxes, M2
includes the chips in special long-timer safety-deposit boxes, M3
includes the credit for chips authorized by the house. To create
different kinds of chips, the banks have to use different reserve
ratios. For one kind of red chip, the bank needs a deposit to the
reservoir of 10 red chips before they'll turn on the tap and issue 90
new red chips. For another kind, they'll need only 5 on reserve for
every 95 loaned out. Blending them all together to get an average,
read that the private banks can created 98% of the bulk of money
leaving the central bank 2%.
: An exceptional
amount of empirical evidence shows that increasing
:the money supply and thus lowering the interest rate lowers the bank's
:reserve ratio and vice versa.
No, lowering the interest rate does not lower the bank's reserve
ratio. Yes vice versa. The reserve ratio has been defined in
legislation by Parliament. Cutting it allows for more and therefore
cheaper borrowing into circulation. But whatever then happens in
circulation has no effect on the rate the Banker sets.
:Sufficient conditions exist under fixed
:point theory for the equilibrium to have interest rates such that the
:requirement for money meets the reserves.
We're not talking about money meeting reserves. We're talking
about money meeting the debt. And no sufficient conditions exist to
have money meet debt with interest.
Generalizations that allow for leakages in the circular flow
:model that I outlined in words above make things a little more
:problematic, but would not fundamentally change the sketched results that
:I gave above.
Forget that you don't deal with the little leakage problem. Can
you deal with the flood?
also commented about how engineers use plumbing models as
:a pedagogical method and a simplifying method. I will acknowledge that,
:correctly used, these models may have pedagogical value in economics.
But you don't comment on whether I used my plumbing model
correctly enough to have a pedagogical value in economics. We know it
works for engineers. You tell us it also works for economists. Did it
work for John The Engineer?
:fact, I recall one professor who had created a system of beakers and
:tubes with a pump that ran liquid through a simple macroeconomic model.
:In this model, too much money (i.e., liquid) had a definite problem -- it
:caused overflow. In the prof's words, a liquidity problem.
I would hope not. Casino cashiers handle those liquidity problems
by moving to larger spaces. But speaking of overflowing chip as a
problem needs to be addressed. Handling financial liquidity poses no
physical constraints whatsoever. There is certainly never too much.
:could be extended to some of the problems caused by inflation.
No it can't. Overflowing money is not inflationary Shift A. I
keep repeating it's inflationary Shift B, the foreclosure of
collateral after interest is passed on in prices.
: In general, dynamic
optimization and dynamic methods are used in
:economics although generally only at the graduate level and higher. In
:fact, whole texts are devoted to teaching the necessary math using only
Okay, whole courses are given on dynamic methods at graduate
levels but that being so, is my blueprint of the bank's interior
plumbing correct or not? Is it of value? Telling me about more
sophisticated ways of modelling doesn't state whether this simple
model has sufficiently done the job.
:I had referred Turmel on a number of occasions
to economics texts and
:encouraged him to read the literature. This was from two motivations:
:(1) Most, if not all, of what I have posted to this thread can be found
:in the texts, and the text will, in general, explain things more clearly
:(less unclearly?) and more completely than I have, and, moreover, the
:texts will more likely be free of errors than my posts. Thus, if Turmel
:wishes to refute the substance of my arguments rather than my
:extremely modest skills as a debator in this medium, he should refer to
:the literature so that his arguments can criticize that.
Every time you imply that the weakness is in your presentation,
I'll rebut that no one has failed to get your presentation. We've
watched your presentation flow through our pipes. These aren't things
that I can't handle forcing me to call in higher authorities, these
are things you can't handle. I haven't had to quote from more than a
few books. This stuff makes sense. You're the one coming across
arguments you can't handle and taking the standard economist's way
out, telling me my defeat is over there.
The fact you can't bring yourself to comment on the merit of my
use of an admittedly valuable engineering modelling tool is a major
hint at how this is hitting at your cognitive dissonance. The fact
that you're already back telling us that they "lend the rest out"
means the whole lesson on the monetary tap didn't register at all.
:(2) In general, if he wishes to
replace the existing economic system
:with a new one, his arguments will need to include what is wrong with the
:current system as well as why his ideas are superior. In order to
:understand completely what is wrong with the current system, he needs to
:understand it, and therefore, should be familiar with the literature.
I don't want to replace the existing economic system with a new
one. I want to replace the existing economic system's accounting
software with an upgrade.
And who to better understand the usury banking system than the
engineer who first drew its Laplace Transform Control Circuit? Check
it out in my Mathematics of Usury. Other engineers have vouched for
The problem is that I'm way past argument. I'm into offering you
better working models. I've offered historical paper and metal ones.
Now the Green or Time computer dollar systems to here to actually use.
You're not supposed to continue to not understand when there's a
working model for you to get on and pedal.
How many economists do you know have a Greendollar account? I'd
bet it's not many. I'd like to hear a prof explain banking to a
student who is a LETS member.
:(3) Some of the problems that have
been recurring in this thread are
:ones from jargon. Notwithstanding any conception of the scientific
:validity of economics, the discipline has, in the scientific vein,
:precisely defined many concepts and terms so that what is being discussed
:is clear. In the interests of brevity and conciseness, I have used some
:of that jargon in posts, although, recognizing that this is hardly a
:forum of economists, attempt to keep the language as everyday as I
:possibly can. As a result, Turmel has mis-interpreted several of my
:statements. Similarly, I have mis-interpreted several of Turmel's since
:I am uncertain of his meaning.
That's why I keep trying to talk about the plumbing. I'm the one
trying keep things in clear simple engineering language and I seem to
have no difficulties with my my simple terminology adequately handling
:Turmel also points to a number of examples
which he cites as examples of
:interest free systems in history, which he claims are not analyzed in any
:economics literature. I will certainly agree that I have never read
:anything on these examples. However, this is not my field -- those
:examples do not fall into my particular discipline.
But for the topic "Interest-free banking" not to exist at all
tells quite a lot. I thought it was an Economics "given" that there
must be interest.
:I cannot state
:whether there exists any literature that does mention any of these
:examples in an economic sense -- I would _suspect_, though, that economic
:history and comparative economic systems might include literature on the
I can't either. I know of the two economists quoted by Walter
Stewart in the Oct. 4, 1993 Toronto Sun article titled "No-interest
loans may save us." Dr. Jack Kersell, political science and Dr. Robert
Needham, director of the Canadian Studies Program at Waterloo.
Their information included the Guernsey Island currency system
and the Sovereignty movement in the USA of 3000 municipalities voting
for interest-free Greendollar loans from the Federal Reserve.
If there were any information on Guernsey or the Tally system,
they would probably be your best bets in the Economics world.
It gratifies me to hear economists talking about interest-free
money systems at last though I haven't heard much since.
:I am aware of one person who, as a Master's
:interest free systems since interest is still considered usury in Islamic
:law and thus, in fundamentalist Islamic states, does not exist if I
And how do you answer Mohammed who would have you executed for
admitting to him that you take usury and you'll continue? Maybe his
age saw evil in the device that our age is blinded to. I see it but
I'm of a new age and know why they made loansharking punishable by
death in olden days. It robbed people to bankruptcy and bankrupt
people end up dead sooner.
I'm not sure if Islamic systems have interest-free loans
only among those borrowers splashing in the pool or whether the loans
are also interest-free from the tap in the pump-house. Somehow, the
mere lack of startling success of the Islamic banks, the lack of
wonderful success stories as generated by the pleased customers of
LETS banking, would seem to indicate that they haven't beaten the
interest drain in the pump-house yet. But they're be great candidates
for an interest-free pumphouse too.
:I did comment, though, on Turmel's example
:LETSystem, that the non-existence of interest was not sufficiently
If the non-existence of interest cannot be sufficiently
demonstrated when it's been designed out of the blueprint, then
you've got your eyes closed. I call this "judicial disease."
The worst corruptions can go on in courts of justice when a man
can keep his eyes closed and say he has not been sufficiently shown.
In the hundreds of legal actions I've undertaken in the decade and a
half, half the judges used the alibi of not having been sufficiently
shown. That you've got a case but not enough of a case. It's a sleazy
judge's trick to deny the truth in a crooked decision because it's the
perfect alibi if the truth ever wins. "Sorry, I wasn't convinced."
I don't know how many times we have to stick that plumbing in
your face before you're sufficiently shown. You haven't objected to
one point in the plumbing. You haven't once said that this didn't come
out of that pipe and had nowhere else to go. You look at pipes pumping
liquidity and turn around and say "I' have not been sufficiently
shown" so I'm going to continue saying that loans are coming out of
the reservoir. That's too weak.
That's one advantage of economists never admitting they're wrong.
When we're discussing the pipes at some other conference years later,
someone will speak up and point out that Tim Huyer was not
Personally, I consider all of this a moot point. I see no reason
:why there cannot be interest free lending going on in society. It is
:also entirely possible that a society which is entirely interest free can
:find a stable equilibrium -- in fact, if any of the examples that Turmel
:mentioned sufficiently demonstrate that interest did not exist (including
:implicit interest) the proof is already done.
Thank you. Now let's get on the machine and start pedaling.
Surely your student union could start one for pennies.
As I said, in my society where everyone has their interest-free
credit card, loansharks would be free to try to peddle their savings.
But how would they do it? Would they stand in the stores and as people
approach to use their own interest-free credit cards, say "let me use
mine to buy it for you today and you can reward me with more more
tomorrow for having saved you using your own card today?"
When you've got a world of interest-free credit card holders,
when do you think you're going to get an opportunity to loanshark to
anyone? And though you've bemoaned Rockefeller losing that opportunity
to loanshark as a possible violation on his property right to own debt
slaves, Rocky just won't find any customers among a civilization of
people who all have their own personal connection to a global
interest-free money system.
Really great times are almost here. It's fair to trust in the
probability of those dreams. Mankind won't be chasing the food tokens
in an evil rat race forever. Soon the food will be falling off the
robot trees and I think the allure of spending one's life in the care
and accumulation of tokens will pale to the intellectual, physical and
scientific accomplishments we'll be able to attempt.
I guess the Bible is once again right in mentioning you cannot
serve the money rat race and serve your fellow man too. Makes sense in
a law of the jungle where it's always him or me.
There are two issues that I view: (1) does the current system
:with interest have all of these fundamental evils which Turmel attribute
:to it? and (2) would an interest free system necessarily be superior?
: I believe that I have been speaking mainly in regards to (1).
:For (2), again, I merely note that interest free lending is still
:possible in this society. Therefore, the set of feasible outcomes under
:the interest free system is strictly a subset of the set of feasible
:outcomes under the current system. This is sufficient to show that
:social welfare, or whatever measure of social value, is at least as good
:in the interest system as the interest free system.
The other way around. Social welfare is at least as good in the
my "interest-free" system as the current "interest" system, if not
better is my claim. Even if you argue me to a standstill on any point
where both systems suffer the same calamities, in most other
respects, problems associated with poverty will not arise. Read the
press results. Open your newspaper and read the financial stories of
death and dying then read some articles from the Greendollar world
about people getting on with life and loving what they're doing.
As long as I keep reading things like "LETS was my life-boat" and
"Greendollars made me love my community," I'll argue by fiat that
everyone should have a taste of financial security in a LETS life-boat
and judge for themselves. It's really Heaven when you can never owe
anyone for anything but your time.
Can you imagine the sense of accomplishment I feel when I realize
I had a helping hand in getting that Greendollar service to them which
changed their economic circumstances?
Can you imagine the jokes and batterings I took before the
LETSystem was launched when I could only suggest that poker chips
would make for better money. For 5 years, I ran in every election I
could to tell me people that they could run a bank themselves with
poker chips. Many did it every Friday night. The media reported it the
way it was to be seen, a clownish suggestion.
I argued with economists when I picketed the Bank of Canada
every Thursday for 5 years. Our debates would draw hundreds so don't
wonder why I handle all your "buts" quickly and most effectively, I've
seen thousands of times before. I will grant that you've challenged me
into some innovative expression, the expansion of the pipe flows being
Now, it's Greendollar poker chips by computer and everybody's
raving about this new-fangled computer invention. Imagine the picture,
poker chips, albeit computer poker chips, receiving acclamation from
around the world. Poker chips saving the world. It's true.
:The mathematics of
:the explanation is rather vaguely described in this paragraph but I am
:hoping that readers will be able to grasp the intuition.
There's no reason to resort to intuition if they think in terms
of chips or Greendollars. There are better models to help visualize
rather than intuit.
remember that "Are loans old depositors' savings or new
:: chips?" is the original question of debate.
:Perhaps this is an example where I have mis-interpreted what you have
:stated. Economists categorize money in several levels, M1, M2, etc.. M1
:would roughly be the new money created by the central bank, the other
:levels include M1 but also include what happens when banks loan out
:money, etc.. The supply of money is substantially greater than M1, so,
:in that sense, banks create money.
That's the whole point of this stream. Economists all admit that
banks create money. When I say, "let's use plumbing, here's a tap,
where do you put it?" they don't know. They don't realize that they
turned the tap when they made the loan because they're too busy
telling the people it's from the reservoir.
Most admit that it's when they make loans so it's evident that
the loans pipe is connected to the tap. Why won't they admit that?
Why is it so hard for them to say "The banks create money when they
make loans, loans come out of the tap."
They cannot accept loans from a tap because they they're holding
all these deposits they said they needed before the could lend. And
it's not comfortable telling a banker that he had access to a tap all
these years when people needed liquidity even though he thought he was
limited to what was in the reservoir. Accepting that loans come from
the tap raise a whole series of moral issues not yet addressed.
So it seems that Tim admits that they create money. Does he also
accept that it's when they make loans and that's what's coming out of
the loan pipe from a bank is from the tap and not the reservoir?
:However, each loan is matched by a
:deposit, and each deposit by a reserve amount -- this much I know is
:taught in first year macroeconomics. Banks loan out deposits,
There are two kinds of deposits, the ones the saver put in his
savings account and the one the banker put in the borrower's account.
Tim doesn't make this plumbing to know the distinction.
:and the flow of money in the loop creates
the extra money.
As I earlier demonstrated to another reader's satisfaction, if
you flow money through your piggy bank loop without a tap, you end up
with more IOUs and more Deposits Slips but not extra money. Only when
you have tap can there be extra money.
:Fundamentally, all new money comes from
the central bank.
And it is absolutely incorrect that all new money comes from the
central bank. The central bank's original 2% is rolled over 50 times
by the private banks who have their own taps. You're saying the only
tap is at the Bank of Canada. This is absolutely incorrect.
:: What social
democrats support LETSystems? And why aren't they out
:: here spreading the good news of a do-it-yourself self-help private
:: money system that allows you to bypass the interest debt system.
:For the record, I do. To repeat, although I vehemently disagree with
:you as to why a LETSystem is good -- I completely reject your arguments
:regarding the evils of interest and that the LETSystem is a correction
:for this, I feel that the LETSystem remains valid for social democratic
:reasons. Part of my basis for this comes from strict economic analysis
:as well, so my expectation is that a LETSystem is also beneficial
: My previous explanation was clearly too terse, since I think it
:was mis-interpreted (my fault). Markets are not complete when goods or
:services do not reach the market -- i.e., if there is no market for a
:particular good or service.
: Clearly, there are many people who have marketable skills or
:goods but do not have the opportunity to market these skills. In
:particular, these people include lower income and unemployed (hence a
:social democratic view). If the LETSystem allows these people to find
:markets for their skills that they could not find in other markets, then
:the LETSystem is necessarily of net benefit to society (more strongly, it
:Pareto Dominates, which is an economics term).
So clearly they can't market their skills because there's
insufficient medium of exchange. And LETS allows them to trade their
skills because it provides medium of exchange. And no interest to
cause decay of their promissory Greendollar IOUs. My point is that the
world is now a Grand Financial Hell with people under deathgamble
contracts enslaved everywhere but LETSystems provide little gardens of
financial Heaven which should not long remain unnoticed.
am aware of some social democrats working on
:developing/expanding a system in Calgary. You might even be surprised to
:know that I forwarded your e-mail address to them, since I suspected that
:you would be able to provide better technical advice than I can even if
:your motivations are wrong. As possible policy development, I would suggest
:using the LETSystem within community development projects, which I
:consider to be social democratic policy ideals.
Right you are. I think getting a bunch of small home-grown
entrepreneurs trading together is small potatoes compared to when it
hits the database of any large community development projects. Imagine
all the work which could be perform if everyone in the project could
sign and contribute ten 1 Hour IOUs which management can disburse to
fund 24 hour surveillance. Kids young people could be out earning the
working parent's share of the Hours owed.
: I do not advocate,
however, abolishing the world banking system
:and replacing it with LETS. LETS complements the existing system, it
:adds to the system, but it does not replace it.
I don't want to abolish the world banking system, I want to
replace the world banking system's software with LETS. If the present
system stinks and people find that the LETS helps, why keep around
anything that stinks.
This sort of follows my experience with the Green Party of
Canada. I joined within the first year, 1984, and encountered amazing
resistance to the idea of the Greendollar system being used on a
national basis. Five years later, LETS is on the policy program of the
Green Party of Canada but with local use recommended, not national or
international use. I keep screaming "We've got a rocket engine, here,"
and they keep wanting to put it in the lawn-mower.
I do appreciate your giving those Calgary people my address for
information on LETS. Quite a class move, I grant. If Calgary builds
itself a huge life-boat, you'll have had a positive hand in it. It's
reward enough for me to know they're trying. You've earned an A-slab
by speeding up the solution versus earning a K-slab by working to keep
Abolition of interest rates is the greatest crusade in the
history of all civilizations since I don't believe many civilizations
rise up without a medium of exchange and money cancer is money cancer
whenever money starts being used. Interest is the lash of the money-
lender's whip. It is the enslavement device. It's been decried as sin
in the history available and we're on the verge of being rid of it.
If you really want to know about the Heaven Christ promised with
his LETS algorithm, "Their abundance should at the present time be a
supply for your want so that your abundance may later be a supply for
their want so that he who gathers much doesn't have too much and he
who gathers little doesn't have too little." LETS does that. LETS
delivers what the Muslims, the Christians and Jewish saints all with
for and eliminates all the ugly financial effects of inflation and
unemployment that they also decry of usury, the enslavement device.
That is the dream of a LETSystem software used on World Bank
computers. Abundance, machinery, experience moving out to areas of the
world now ruled by accurate credit card demand.
Again, I posit that if the world's top 50 billionaires took it
into their minds to order their banks to offer us a world Green or
Time dollar system, as an alternative to the current model, the
acceleration to extinction would come to halt and an acceleration to
survival would take over. Turning all our tanks into tractors makes
for bigger crops.
Just imagine that everybody tending a farm has an open credit
lime for the best of everything. Consider safety. In order not to pay
inventory on stock, most businesses keep lean inventories and order
when needed incurring inefficient delay. If stock could be held
interest-free, all garages could have many times the anticipated
demand. Yields would be great, service would be great, share would be
The current system rewards the positives by taking from the
negatives. The effects of eliminating this feedback should not be
underestimated. Just contemplate the industrial explosion if everyone
had an interest-free credit card. But also contemplate the natural
limits to credit creation. Can't issue more Time dollars than the Time
everyone could work. Labor must be performed before credit.
I wish everyone could see the happy potential I see in the world
:: John Von
Neumann, the famous author of "The Theory of Games and
:: Economic Behavior," said that "important questions in economics arise
:: in an elementary fashion in the theory of games."
:[ ... ]
:: Insistence on statistics boils down to wanting to use something
:: hard and esoteric to explain something easy if modeled using a game.
:Econometric modelling gives evidence to whether the correct game (a
:special case of an economic model) is being used. Clearly, every game
:can be verified by a Monte Carlo experiment, but is it verified in reality?
I think that the Monte Carlo experiment is going on before your
very eyes and has been for 5,000 years. And in all those 5,000 years,
no one's every been able to figure a way to come up with 11 when they
only printed 10. Have you had any acquaintances who've lost their
homes because of shortage of money? Have you had any give up and
commit suicide because of a shortage of money? I think this is great
empirical evidence that there is insufficient money.
Of course, if you're unaware that this experiment has been going
on for ages because your history course doesn't go back that far, then
the "test-many-times" Monte Carlo methods may not have been used. But
governments crying "broke," businesses crying "broke, people crying
"broke" is not historically new. Examine any system where things were
breaking down and you'll see that financial debt existed to break them
down. That would not be happening if there were too much money. So,
yes, it seems pretty verified in reality that the problem is a
shortage of money.
:This post is already getting long and
my time has also run out. Again, I
:hope to be able to read the other parts of Turmel's post and reply to any
:important points as time permits...
These posts may be long but there are a lot of important points
being tackled here. The circuitous nature of the objections to the
same points seems to indicate that there is a lot of issues which have
difficulty in being retained. That "loans are not from depositors'
savings" being the Numero Uno point economists cannot remember.
And I often wonder if it couldn't get the fly better with sugar
than vinegar. The problem is that spice with the vinegar makes for fun
reading. And most economists who have ever challenged The Engineer in
public have quietly slinked away. So I've never felt too bad about not
using the sugar route when faced with a recognizable condescending
Yet here's a kid who I've made brutal fun of who has every reason
in the world not to want to help me but who still has the integrity to
connect me up to those possible LETS allies. Once he admits that the
"the loans pipe is connected to the tap" and "loan payments pipe is
connected to the drain, I won't be brutal again. Until then, if he
wants to dance among the pipes with me, it'll stay rough.
But I acknowledge an A-slab that someone will someday applaud
rather than bemoan his helping to Give LETS a chance in Calgary.
TURMEL: Social Credit Stream
Tim, did you notice
how many times I said "Imagine what it would
be like with an interest-free credit card." That's not so hard to
imagine as one might think. It was my request to the Supreme Court of
Canada in 1982. I had charged the Governor of the Bank of Canada with
genocide on the grounds interest rates were resulting in the death of
Basically, I alleged that the failure of the economic system to
allocate the available abundance to the needy resulted in the genocide
of poor was not an accidental malfunction of the economic system but a
programmed malfunction within the software of the control system at
the bank. I asked that the banks' computers be restricted to only a
service charge sufficient to defray business costs and the interest
charge on the mortgage deathgamble be abolished.
How would your life had been affected in 1982 had the Supreme
Court of Canada had restricted your bank to charging you only service
charges on credit after ruling that interest rate policies were in
fact reducing food production and increasing statistical starvation by
putting farmers out of production. Suicides too. Banks with use only a
14 or 15 years ago, you might have been in grade school. One day,
they might have come into class and handed you your interest-free
credit card on the understanding that all your academic, social and
physical needs will be paid for with your own credit and that someday,
when you graduate and start to work, you would have to pay it back.
With no interest. I know that if I'd been loaned $5 to go on the rides
at the EX or $100 to buy a bicycle when I was a child, I've have been
more than willing to honor that social debt now.
This concept of giving children their credit access to life-
support is not new. Since credit is good, Isaiah 55: "You who are
hungry and have no money, come buy and eat," and since children today
are hungry and have no money, credit should be given to children so
they be able to come buy and eat independent of how daddy's doing.
Junior's access to academic, social and physical resources will remain
independent of daddy who might be a drunk or a losing gambler.
So from now on, how much for the best paper, pens, books becomes
an auxiliary consideration since it should cost close to the same for
I'm not hinting that you won't be left with a large debt when you
graduate. If you've received 10,000 hours worth of manpower for your
training, think of it as your first five 2,000 hour years of work
going towards your student debt. Today, it might be all your years of
work to get out of debt with interest.
In the meantime, you'll be incurring new adult debt. Machinery,
tools, capital start-up costs. All purchases with your interest-free
credit and all earnings paid on that interest-free credit card.
The real beauty is that there is no repayment schedule. It
might take people 10 or 15 years to pay off student debt and business
debt and get into the positive. 10 or 15 more years of positive time
earnings should leave plenty to retire on.
Exploitation of labor by capitalists cannot occur when every
laborer is a capitalist. the only real issue then becomes
profitability of cooperative association.
Today, the contractor who has been blessed by the bankers with
the access to the credit tap to buy supplies take the gamble, buys the
time of the wage slaves and hope he's successful or he suffers
foreclosure and loses it all.
And every wage slave dreams of getting a banker's nod to access
to the credit tap so they can go out and buy some slaves and take a
shot at the industrial of mort-gage. Imagine the irony of slaves
remaining enslaved because each hoped to someday get above the chains
and in on the free ride himself. Changes the picture when you see that
the system helps those at the top stay there.
So the general contractor gets a loan from the credit tap and
puts together his project. With the skilled carpenters, plumbers,
electricians merely selling their time and having no share in the
industrial gamble, their hearts can rarely be in their enterprise. If
the product is profitable, the contractor of the deathgamble is the
one to benefit of it all.
That's why people are so ready and willing to stick their heads
into the usury noose. As Tim so readily pointed out, getting the loan
even with interest is more important than not getting the loan at all.
Faced with not getting the loan at all, he would not accept the insist
on abolishing interest. It does make sense if you are trying to
survive that taking the gamble on surviving is better than barely
surviving if not often dying.
But on the same day the students got their interest-free credit
cards to eliminate financial worries for the rest of their education,
(never will you miss a concert or event you want to see because you
have no money), on that very same day, the carpenters, plumbers and
electricians all got their own interest-free credit lines at Canadian
Tire. Now they could pool their own credit and build a project in
which they share the capitalistic profit. There's no more reason to
have to work for someone else unless there be an added profit in that
What a wonderful kind of capitalism. Little guys jousting with
big guys in a new kind of musical chairs where there are enough chairs
for all to survive. When everybody owes 11 but everybody borrowed 11
and not 10, changing it from a "kill-or-be-killed deathgamble" to a
"all-survive" lifegamble. It's a paradigm shift that eludes most
This paradigm shift in perception of the world around you can be
demonstrated to anyone who has ever played musical chairs. Pushing and
elbowing are common characteristics in this elimination death-gamble
of 10 people and 9 chairs. Just like 10 borrowers and 9 survivors in
the usury deathgamble, looking out for Number One to the inconsequence
or detriment of other possible victims is optimal strategy. A law of
the jungle where only the fittest survive. When the butcher across
town goes under, you cheer. Not because his kids are going to out in
the street but because yours won't.
Now eliminate the imbalance so that 10 people have sufficient
chairs for all to survive and pushing and elbowing will disappear as
what used to be an elimination gamble to the death has now become a
much more civilized non-elimination competition for the biggest chair.
Similarly, eliminate the demand for more money than was loaned out and
the sufficiency will mean that you won't mind the other butcher
serving the other side of town since you're so busy serving yours.
So the trades unions will dissolve as millions of mini-
capitalistic construction cooperatives are formed by all the tradesmen
now armed with access to the resources they need. Big ones will still
be needed for greater profitabilities.
What happens to the down-and-out? Sure, most people capable of
using their credit lines in entrepreneurial endeavor will get to work.
What about all the mentally handicapped people recently-released from
shut-down government facilities.
Noting that these people are the relatives of families on the
database who now have the credit to support them, and families will
become important credit pools, I think it would be quite fair to offer
them the same credit cards.
Pooling their guaranteed credit could afford large groups the
services of medical staff, administrators.
Freeing the prisoners. This is a big one. 90% are in prison for
poverty-induced crime, theft, robbery, smuggling, violent reactions to
their poverty usually after consuming government-sanctioned alcoholic
"mood amplifiers." Many are in prison for avoiding government-
sanctioned alcohol and preferring the escape of drugs from their
Free a convict who did it for money, give him his interest-free
credit card with an explanation of the new job and education options
now open to him and I doubt he'll ever be back for stealing your TV.
It makes sense that when the Local Employment Trading Software creates
very much employment, they're too busy earning and spending to be
Imagine being a young doctor with special theories to examine. No
more spending 90% of your time looking for funding. It's spending 100%
of your time looking for cure. And if you don't find it and leave the
world with your credit card way in the negative, it's a loss I won't
mind my government using my taxes to cover. The volume of valuable
contributions will far outweigh the volume of failing ones.
Imagine the horrible search for investment money gone from your
lives. The house itself is the collateral for a loan. Imagine gone
this horde of mortgage-brokers sticking you with fees to find you
investment money. Imagine having all payments go against only the
principal. That's financial heaven.
I can't think of one sector of industry not benefiting from
complete access to whatever credit is available. After all you can't
buy something that's not there but if it is there and no one else is
bidding on it, you certainly get it as a right.
The only sector I'd think would worry are the clerks in the
financial boys doing it to us and the clerks in government trying to
share out the pain. Clerks would have the same opportunities that
students and newly-free prisoners have. Jobs would be opening in
manufacturing everywhere or they could train to get in on the rush.
And surely they would like to spend their money tracking real
accomplishments rather than tracking dollars.
Remember that there's a big difference between capitalism where a
few enslave the rest and capitalism where everybody owns only himself.
The capitalism decried by the Communists and Socialists is only the
one that enslaves the laborers. That they haven't seen that the real
chains are financial and have not suggested financial reforms
indicates that none of these isms are dealing with our real chains.
Of course, the mighty corporations will lose all their power when
surrounded by millions of worker bees forming their own bigger and
bigger hives of honey. The mighty corporations may not choose to lose
all their power to the e-money revolution gracefully.
The mighty corporations led by the banks use all the world's
intelligence agencies to keep the slaves down. And it gets harder and
harder as the dying keep resorting to rioting and guns. You just have
to read Noam Chomsky, one of the most enlightening of the explainers
of how the mighty corporations operate their slavery system, to
appreciate how easy it is to slip into a police state including in
Canada. He also is so busy looking at the military-police chains that
he doesn't dwell on the invisible financial ones but the fact of a
mechanism which takes from the poor and starving to give to the rich
is there. And taking from down-and-out is an ugly business. Mike
Harris campaigned to win Ontario's election on the promise of cutting
life-support to the poor. And he's doing it. And it's ugly.
How the mighty corporations have financed wars, caused market
collapses, hidden advances in energy to maintain prices on oil, these
guys are pushing and tripping the sheeple nations every which way and
profiting with every fall.
So if you owned the world's military-police state, how would you
react when people started slipping their debt nooses and surviving in
Greendollar life-boats on their own? How would you feel about talk of
building one big Global Greendollar life-boat where everyone would
have equal access to society's resources?
Unless you're worried about how people will react when they
realize how the world money system could have been fixed way back when
Major Douglas suggested his "Balance the interest with new money"
solution. Throughout all the wars since then, that's a lot of dead
people who probably wouldn't have ended up dead if you'd not waited
until now to fix it.
This is the theory of the K-slab I used in my indictment of the
Supreme Court of Canada! It's in my bankpoem.
People are on a conveyor belt falling of to doom. If you have the
power to push the stop switch right now but a few more will go over
due to momentum and you proceed to think about it until tomorrow, the
difference between the number of people who fall off today and those
who would have fallen off yesterday is the number of people who fell
off during the delay. Pretty simple mechanics.
I told the 3 judges of the Supreme Court of Canada that the world
was losing 46,000 dead babies a day. Restricting the international
networks of 7 Canadian Super banks to a pure service charge would
start the comeback bringing the death rate down. And down to zero.
That would still happen today, almost 15 years later.
Those judges had the power to push the stop switch then and more
would have still gone over due to momentum but when they thought about
it and said no, 15 years later, it's fair to say that the number of
children who not have fallen off Earth's killer conveyor belt is the
number who died during the delay. I called it the judges' Equation of
I love to say "It's your judgment day is you see the solution,
have the power to work for it and don't:
Extra deaths = 46,000t where t > 5000 days = 235 million.
Since 1981, the death rate has gone down to 30,000 per day, down
almost 1000 a day for each of the last 15 years. 30,000 dead babies a
day still stinks as an economic performance.
I think that if the judges had switched Earth's industrial engine
to full power by abolishing interest in the large Canadian
international banking system, world production would probably be
handled by now without the loss of at least 200 million babies.
I said that this question of genocide is bigger than anyone can
imagine and if you have the power to help shut off the killer machine
and you don't or you wait, you're costing lives you can never get
back. It compels devotion to the cause. Any day today I can help speed
up the healing process is worth the saving of 30,000. When I first
started my fight to abolish the death-gamble, my stakes were 46,000 a
I told one judge: Just like in the movie 2001 where the killer
computer is finally beaten when the human pulls his plug, here we sit
in front of the bank's killer computer and I'm the engineer telling to
you to pull that plug and shut off the interest. The judge said "Can't
this wait" and I said: "Not at 46,000 dead babies a day, it can't.
Some people are going to want to have the International
Loansharks shot for what they've done. With that attitude, they'll
never set us free.
Whenever I get into the guilt of the genocidal international
loansharks, I always make sure to mention that I'm in favor of Global
Amnesty for International Bankers too. I say I can forgive, forget and
get on with Heaven on Earth leaving judgment to the Father. I call it
ASA, global aspirin: Amnesty, Security of your credit card, Anonymity
for crimes committed.
I can't think of a better deal to offer those now atop the killer
banking system. They might have a tiger by the tail. They might be
looking for a way to get of without having the freed debt slaves turn
against them. And who can blame either side while we were living under
the Law of the Jungle where some must always be eliminated.
If we can just change the financial game to allow all to survive
while retaining its capitalist entrepreneurial spirit, most will be
too instantaneously preoccupied in self-enrichment to really insist on
crimes committed under the Law of the Jungle.
But if you've got your interest-free credit card and you steal my
TV instead of taking credit for the TV on your card, then you've got
problems. If you go to the point-of-sale in a store and demand "This
is a stick-up. Credit my account," then you've got problems but
problems better handled in a mental hospital than a prison.
With Full Local Employment (FLETS?) Trading going on through an
interest-free credit line, the base reason for most crime, the
financial inducement, would be eliminated. When they watch our current
TV shows in which virtually all criminal plots are based on getting
the insurance or the inheritance or the girl, people's continued
inability to see their predicament in this deathgamble rat-race will
seem to our children's children quite insane.
Imagine the whole adult world not being able to perceive the
elimination nature of a game where you owe 11 for borrowing 10.
Imagine players insisting it's normal to keep trying to pay back more
because that's the way it's always been done.
Oh what kind of Hellish device can so affect the mind as to
compel its participants to play musical chairs and dance their way to
their deaths without realizing the foolishness of what they're doing.
Christ hit the nail on the head when he said that when it comes
to interest, the theme affects the head:
They'll forever be hearing without hearing and seeing without
seeing because their hearts have grown cold.
Jesus was a great loanshark-fighter. What a sharpie.
He defined the differential equation for the interest system as:
"To those who have abundance will more be given but from those
who have no abundance, even what they have will be taken away."
He then defined the differential equation for his LETSystem:
"Their abundance should at the present time be a supply for your
want so that your abundance may later be a supply for their want so
that he who gathers much doesn't have too much and he who gathers
little doesn't have too little."
Socialistic and Capitalistic at the same time! Christ. What a
I've always had trouble trying to bring Christ into the
discussion with techies. Mention that the algorithm behind the
LETSystem is Christ's differential equation and they freak. But others
have seen that same differential equation I do and it is the
differential equation behind the Green and Time dollar systems.
So Tim, I'm shocked when you say you like what the Greendollars
can do but you can't accept the evils I ascribe to interest. You're
going to face a day when your municipality asks you if you'd like them
to provide a Local Employment Trading System and your vote will
determine whether you'll create for yourself an interest-free source
of credit which will eventually eliminate your need for any interest-
This explosion to where everybody in town takes Green happens the
moment any municipality starts taking Green for taxes. It's as almost
here as that. Your social activists who are setting up LETS, often
with government support, just do not yet see the advantage of giving
that government Account #1. But the moment government spends a million
Green and we can pay our taxes in that Green, everyone will take it
and everyone will now be available as a new trading partner.
Just because LETS organizers have always been preoccupied with
the Local in Local Employment Trading System and have always thought
small doesn't mean that whole databases can't turn on at the same
I suggested that my Freenet provide a Greendollar account, one
new field in my database record, and a program to email Greendollars
transfers to other accounts. It's as trivial as that to have a
database of millions. I predict that the first major Internet provider
to offer Local Employment Trading Greendollars will sweep the market
with all the others soon following suit.
We cannot allow them to set up their e-money systems whereby we
have to pay interest on the electronic credit we borrow. This is the
major impetus of the financial world: getting people to pay interest
on e-money. It won't be an easy sell, especially with use of
Greendollar software expanding on the horizon. I think they will not
But how can it be stopped? As long as Greendollars can operate
side by side with bank dollars, who is going to be stupid enough to
keep using bank dollars? And Greendollar accounts can be delivered to
whole databases overnight.
When he says he is defending the right to take interest though
LETS is okay, it gives me a chance to dwell on just how terrible
interest is. I tried to hint at it by mentioning the capital nature of
the offence to many of history's most sainted people.
I think I'll repost the story of my genocide allegation about
interest rates at the Supreme Court of Canada. See TURMEL: Genocide
charge in Supreme Court. I reprint my arguments as they were written
for the court.
If a banker were charged using the Criminal Code, they'd have to
go interest-free while it was being discussed. I've always felt that
every court appearance was a shot on the goal of getting us our
interest-free credit cards. And I've engineered hundreds of court
challenges to interest rates before judges with power to do something
So I'll argue from now to the end that interest rates are evil
and are the only difference between the Hell of the last millenium and
the Heaven of the next. Wouldn't it be fluky if humanity could fling
off its debt chains before 2001, a date which contains much potential
for much technological change. Too bad about the K-slab of losers
we're going to lose to the Conveyor Belt of death between now than
then but environmental catastrophes might have passed the point of no
return by then and nobody survives anyway.
Interesting problem for the Owners. The whole ship's decaying and
the longer we delay freeing the slaves and going to full power, the
more dangerous it gets for them too.
I can only pray the finesse is on-side and expect accordingly
that we won't be past the point of no ecological return when the money
regulator is fixed.
I hope how you can appreciate my emotions as we calmly discuss
whether the bad effects of interest are necessary trade-off for the
necessary reward for parting with one's savings when I count those
trade-offs in unnecessary misery and deaths.
As I tell the rich man, if you have a bank-roll of 100 which buys
you 10 Buicks today and you bank it to get 120 at 20%, the interest
caused the price of the Buicks to inflate so that your 120 still only
buys you 10 Buicks. You can't get something for nothing unless someone
else gets nothing for something.
But the government took half your 20 in taxes leaving you with a
bankroll of 110 which buys you only 9 Buicks.
By taking the interest increase, you suffer inflation of your
whole bankroll and lose after the taxes. It's better to get no
interest from your casino cashier and have your bankroll buy 10 Buicks
all the time.
Neat trick isn't it? Getting the guy to want more which causes
him to lose in two ways. He thinks he's winning but he's still losing.
It's a Rich man's delusion.
The smart gambler knows it's better to break even than chase
fool's gold and end up broke. I couldn't call myself a good gambler if
I couldn't see the two ways I'm losing money by chasing interest.
I see no other way to mobilize maximum industrial power in the
goal of saving our bioshpere without correcting the usury malfunction
in the monetary system.
a comment to John Turmel