A brief history from MoneyWeek…

Posted: December 17, 2014 in Fractional Reserve Banking, Paper money
Tags: , , , , , ,

MoneyWeek-History of Money

Please view this document, pages 5-7 only, as a supplement to the already documented history of Money which has been posted on this blog and elsewhere.

The key points I noted from this account, are as follows;

  • “Debt is the slavery of the free..” Publilius Syrus, Roman Author. Again, this brings into question the entire notion of the ‘Free World’ and our understanding of contemporary freedom. This, together with the enormous volume of man-made law and rules, in countries that are often seen as beacons of liberty, expose our false reality.
  • When covering the early days of Goldsmith banking practices, the report includes mention of how depositors demanded a share of the profits, or what became interest received on assets held by the ‘bank’. I highlight this point as it is an essential component in the risk-reward mechanism within capitalism; the risk of losing ones holding is compensated by these interest receipts, thereby an acknowledgment that your deposit is being lent and it is not fully guaranteed to be returned if requested
  • The fallacy of reserve ratios: the fraction which must be held in reserve, or not lent out, is still far larger than anything tangible that can back it up. Therefore it can never control the act of lending out multiple amounts, which continue to expand the money supply, and thus asset prices and inflationary pressure.
  • This piece reiterates the ‘false’ gold standard that existed pre-1971, where only a percentage of the money supply in certain regions was backed by Gold. During this era, nations were effectively dabbling in a mixture of fiat and commodity money, which didn’t stop the USA from printing freely when the need arose in the 1960’s.
  • ‘The greatest credit bubble in history’..‘The modern monetary system relies on ever-expanding debt to function..’ Put simply, how can this be a preferred system to live by, when we are all living on borrowed time and our reality is being carefully managed and MANIPULATED constantly to keep the bubble afloat. How can trust ever count for anything.
  • As the piece continues it states..‘as debt grows, so the cost of servicing it rises and you have this never-ending bubble of expansion that requires people to work harder and harder and business to expand and expand..’ put this in perspective when Governments talk of deficit and debt reduction, austerity measures, GDP growth, ageing populations, quality of life. This is an inter-generational struggle which will continue until it collapses
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