Usury, what is the solution?

[BillBoard]

The way I understand it. -The Fed creates the money and we pay them interest for the simple fact that they create the money.

The Mint could make the money interest free, but then what would happen to Federal Bond (Treasuries)?

[aaron]

Re: Usury, what is the solution?

You create the money when you borrow it to buy houses, cars, and other stuff on credit.

[BillBoard]

Re: Usury, what is the solution?

You create the money when you borrow it to buy houses, cars, and other stuff on credit.

I know, and it is destroyed when I pay it back.

But it does not answer my question. If the government creates the money usury free, would it still need to issue bonds? How would the money be destroyed once the government has issued it?

[jacobdcoates]

Re: Usury, what is the solution?

It would not need to issue bond or collect taxes for that matter. The money could not be destroyed either, unless you burned it. But and there is always a but... inflation would be proportional to the percentage of money that was created vs the money supply, There is no free lunch.

[BillBoard]

Re: Usury, what is the solution?

It would not need to issue bond or collect taxes for that matter. The money could not be destroyed either, unless you burned it. But and there is always a but... inflation would be proportional to the percentage of money that was created vs the money supply, There is no free lunch.

Aha! That explains Zimbabwe! And explains why the Gold bugs advocate a Gold Standard.

[jacobdcoates]

Re: Usury, what is the solution?

Only partially. Zimbabwe started doing this prior to their hyperinflation. But that was not the only cause of their hyperinflation. Although it did cause very high inflation(+20%). The hyper-inflationary events are/were caused by the population loosing confidence in the currency, which can be for any and multivariate reasons( high inflation, regime change, economic collapse, poor policy.....etc). Beliefs, belief systems and paradigms have a very large say when determining economic/monetary outcomes/systems.

[Starving Steve]

Re: Usury, what is the solution?

It would be one thing if the govn't would create money to build another Hoover Dam or another atomic power plant, or maybe add onto the California Water Project and maybe divert the Eel River into the California Water Project. These projects would ADD real wealth to the economy. Maybe dredge the St. Lawrence Seaway deeper, instead of 28 feet and 8 inches, to maybe 36 feet to accommodate the deeper draft of modern ocean-going ships. That kind of money-printing would not be inflationary.

The problem with money printing is when nothing is added to the real economy by the money printing for the new money to purchase. Then, the new money dilutes the value of the old money in circulation, hence inflation.

More and cheaper kilowatt-hours of electricity ADD real value to the economy. More fresh water in California adds value to the economy. More shipping on the Great Lakes adds value to the economy. Putting more land for home subdivisions onto the housing market adds real value to the economy by lowering the price of homes.

This is the direction that government and monetary policy should take. To not print money just to be printing money, but to print money to build projects that add real value to the economy and lower the cost of living for everyone.

High-speed rail service would lower our cost of transportation. Sea-floor oil drilling, maybe with the help of government, would lower our cost of energy. Fracking rocks and opening-up natural-gas supplies would lower our cost of living. Up-grading heavy oil and tar to light oil adds to the supply of usable oil and lowers its price. Light oil might also be produced synthetically from coal, and that would lower the cost of oil. Installing trunk-servicing lines in all directions around cities is yet another project for government to do. Building oil and gas pipelines is another task that government could facilitate.

In British Columbia, the Fraser River needs to be dammed for hydro-electric power. Before dumping the Fraser River into the sea, its fresh-water should be diverted southward and sold. A bridge needs to be constructed linking Vancouver with Victoria. Atomic power plants need to be constructed. Oil exploration and oil-tanker traffic needs to be accommodated offshore of the west coast of British Columbia. Constructing better roads and doubling the speed limits in British Columbia are another project for government..... There are many projects for government to facilitate that would add real value to the economy and lower our cost of living.

In the field of atomic energy, the Govn't of China has just found a way to re-use so-called, "atomic waste" by injecting it with fast neutrons. This extends the life of uranium fuel in atomic reactors.... There are many projects for government to facilitate.

[ricket]

Re: Usury, what is the solution?

It would be one thing if the govn't would create money to build another Hoover Dam or another atomic power plant, or maybe add onto the California Water Project and maybe divert the Eel River into the California Water Project. These projects would ADD real wealth to the economy. Maybe dredge the St. Lawrence Seaway deeper, instead of 28 feet and 8 inches, to maybe 36 feet to accommodate the deeper draft of modern ocean-going ships. That kind of money-printing would not be inflationary.

The problem with money printing is when nothing is added to the real economy by the money printing for the new money to purchase. Then, the new money dilutes the value of the old money in circulation, hence inflation.

More and cheaper kilowatt-hours of electricity ADD real value to the economy. More fresh water in California adds value to the economy. More shipping on the Great Lakes adds value to the economy. Putting more land for home subdivisions onto the housing market adds real value to the economy by lowering the price of homes.

This is the direction that government and monetary policy should take. To not print money just to be printing money, but to print money to build projects that add real value to the economy and lower the cost of living for everyone.

High-speed rail service would lower our cost of transportation. Sea-floor oil drilling, maybe with the help of government, would lower our cost of energy. Fracking rocks and opening-up natural-gas supplies would lower our cost of living. Up-grading heavy oil and tar to light oil adds to the supply of usable oil and lowers its price. Light oil might also be produced synthetically from coal, and that would lower the cost of oil. Installing trunk-servicing lines in all directions around cities is yet another project for government to do. Building oil and gas pipelines is another task that government could facilitate.

In British Columbia, the Fraser River needs to be dammed for hydro-electric power. Before dumping the Fraser River into the sea, its fresh-water should be diverted southward and sold. A bridge needs to be constructed linking Vancouver with Victoria. Atomic power plants need to be constructed. Oil exploration and oil-tanker traffic needs to be accommodated offshore of the west coast of British Columbia. Constructing better roads and doubling the speed limits in British Columbia are another project for government..... There are many projects for government to facilitate that would add real value to the economy and lower our cost of living.

In the field of atomic energy, the Govn't of China has just found a way to re-use so-called, "atomic waste" by injecting it with fast neutrons. This extends the life of uranium fuel in atomic reactors.... There are many projects for government to facilitate.

I....I am...speechless.

WHO ARE YOU AND WHAT HAVE YOU DONE WITH STARVING STEVE? A COHERENT POST THAT MAKES SENSE AND THAT I MOSTLY AGREE WITH!?!? WHAT IS GOING ON!!?!??!?!!!!one

I am scared and I think I am going to go cry myself to sleep now...

;)

Now, to actually contribute to the thread: I have read up on usury quite a bit and have posted quite a significant 'rant' against it and the way that it is currently implemented in the US (you may be able to find it in my post history). The summary of my argument can be found in my signature...meh, tried to find it myself but I'm too lazy.

[BillBoard]

Re: Usury, what is the solution?

Only partially. Zimbabwe started doing this prior to their hyperinflation. But that was not the only cause of their hyperinflation. Although it did cause very high inflation(+20%). The hyper-inflationary events are/were caused by the population loosing confidence in the currency, which can be for any and multivariate reasons( high inflation, regime change, economic collapse, poor policy.....etc). Beliefs, belief systems and paradigms have a very large say when determining economic/monetary outcomes/systems.

I thought the hyperinflation happened because the central bank was printing and then exchanging the local currency for foreign currency, and then those that acquired the local currency would then purchase the local resources for export?

[c1ue]

Re: Usury, what is the solution?

I thought the hyperinflation happened because the central bank was printing and then exchanging the local currency for foreign currency, and then those that acquired the local currency would then purchase the local resources for export?

Hyperinflation generally occurs due to ridiculous money printing, and equally generally in turn due to ridiculous debt.

Weimar was due to WWI debts.

Zimbabwe was due to Mugabe and his (even more wacky than neoliberals) economic policies.

[flintlock]

Re: Usury, what is the solution?

WHO ARE YOU AND WHAT HAVE YOU DONE WITH STARVING STEVE

My thoughts also! Good post Steve.

[thunderdownunder]

Re: Usury, what is the solution?

STARVING STEVE !!!!!
Agree - It was done before as an experiment on an Island - It was and outstanding success, so much so the fear it created in the banking classes of England and France led to its Hasty burial in the same way Climate change/ Carbon tax is being pushed to the front - By obsfucation
(Obfuscation is the concealment of intended meaning in communication, making communication confusing, intentionally ambiguous, and more difficult to interpret)
It was called the "Guernsey Experiment" and it strangely mirrors our position today.
http://www.amazon.com/Guernsey-exper.../dp/B0007DUG40 However this is not the original
but through the marvels of the Internet someone has kindly made the original available for all in PDF - My goodness how my family acorns fall close to the tree.
http://www.aberhartfoundation.ca/PDF...he%20Banks.pdf

Warning - the reading of this small book will leave you sadly frustrated, small and alone but will scare Hell out of bankers

[BillBoard]

Re: Usury, what is the solution?

Hyperinflation generally occurs due to ridiculous money printing, and equally generally in turn due to ridiculous debt.

Weimar was due to WWI debts.

Zimbabwe was due to Mugabe and his (even more wacky than neoliberals) economic policies.

I didn't find your post helpful, if anything it confuses me.

An interesting thing happened in Zimbabwe, once they slowed down the money printing they experience deflation. I was thinking that Hyperinflation is more of a rate of growth in the money printing that the amount of the money supply. Very enlightening if you ask me, if you can visualize that.

[c1ue]

Re: Usury, what is the solution?

An interesting thing happened in Zimbabwe, once they slowed down the money printing they experience deflation. I was thinking that Hyperinflation is more of a rate of growth in the money printing that the amount of the money supply. Very enlightening if you ask me, if you can visualize that.

In normal practice, hyperinflation occurs because there is a huge external debt to devaluate.

Mugabe didn't have any such thing. Instead he chose to print money as an easy way of paying into his Pan-African policies.

As for deflation - you should note that Mugabe recently embarked on austerity policies at the IMF's urging. To say thus that the deflation is due to the cessation of money printing as opposed to this austerity would be something that would need proof.

[BillBoard]

Re: Usury, what is the solution?

In normal practice, hyperinflation occurs because there is a huge external debt to devaluate.

Herr Clue I was expecting others to chime in on your post. In regards to your comment that "hyperinflation occurs because there is a huge external debt to devaluate." I believe your statement implies there is a creditor whose interest in repayment of their claims are not too easily denied. That in itself discredits your statement because if it was so, the debtor could just print enough notes to satisfy the debt. Please delve into more detail for us to understand.

Mugabe didn't have any such thing. Instead he chose to print money as an easy way of paying into his Pan-African policies.

Mugabe chose to print local currency to obtain foreign currency in order to buy weapons and war materiel to remain in power.

As for deflation - you should note that Mugabe recently embarked on austerity policies at the IMF's urging. To say thus that the deflation is due to the cessation of money printing as opposed to this austerity would be something that would need proof.

To call Mugabe's actions austerity, is to say the drunkard is going reformed because the bottle is empty. Zimbabwe's was pillaged and could no longer even produce enough resources to sustain its local population.