India wants to develop digital rupee and tax more cryptocurrencies – IT Pro – News

The fact that the accounts are correct does not mean that no money is created.

What banks do is lend money they don’t have. If, for example, they must have 10% coverage, they can legally borrow the same money 10x (and thus earn 10x in interest).

This is possible because there is no longer a need for a physical money transfer. Most transactions involve only accounting, with one person’s credit counter going up and someone else’s counter going down. There is no physical movement of money, just an imaginary one.

Because this imaginary (cash) money is also used for real transactions in the real world, the economic money supply increases. Money is actually created in an economic sense. Therefore, these “fractional reserve” banks are also called “money-creating banks”. Actually. Due to the practices of private banks, there is now 4 times more debt in the world than there is money. Banks’ money creation is therefore debt creation.

What people want to understand is that financial money rests on physical money, secured and ESPECIALLY UNCOVERED receivables.

In reality, it’s a little worse. Because many citizens and businesses are in debt, they no longer have many assets in banks. The coverage for the loaned money therefore comes to a large extent from loans from central banks such as the FED and the ECB, which also create that money out of NOTHING.

Money has now become hot air, constantly added by financial institutions as partial collateral for the ever-growing mountain of debt. Money creation has become detached from growth in the real economy

And we have to earn more, because more and more money has to be lent out. When debts turn out to be uncollectible, these receivables are lost money (the implosion after the financial crisis). But this can be postponed by lending the debtor new money to pay off his old debt. Because there is always interest on these loans, the debt burden increases. In fact, you are digging an ever-larger debt hole to fill the old hole and thus postpone the bankruptcy and the loss of the receivables/debt.

Meanwhile, the economic money supply is also growing, threatening inflation. For this, extra economic money is not automatically a counterpart in the real economy. Therefore, constant real economic growth is needed, the population must continue to increase, women and children must work, labor productivity increases, etc. And then the environment is an afterthought, unless it can create further economic growth. Economic growth that no longer serves the citizens, but primarily serves to prevent the Ponzi scheme from collapsing.

For several decades, the money left has no real value anymore. The gold backing has long since been abolished, and the dollars that replaced it have also long since lost their gold backing. Also, the coverage of the money that banks create out of thin air again comes largely from money creation out of thin air.

The value of money is determined by trust and the economic need for money for transactions (for the money wind trade or goods and services transactions). If the money supply grows faster than the need, it has a negative effect on the value of money and prices. Where the money supply grows plays a role. If this is limited to financial institutions and states, the average citizen will hardly notice.

Until now, it has been seen that the rich primarily invested their increasing wealth in stocks, because investments have been declining for years. As a result, stock prices have exploded to the point of absurdity. The consumer was not bothered by this. Because the rich also begin to fear that the financial system is facing another crisis, they are now investing in land and real estate on a large scale. Ordinary citizens notice this on their own. Housing has now become unaffordable for many people. Rents and mortgages are going through the roof, and the banks are taking advantage of that.

Because bank shares are often held by the rich, this is again a win-win. Before the business collapses, they quickly sell these shares (such as Rothschild’s sale of ABN to Fortis) and buy them back for a tip when the governments bring the banks back to health at taxpayers’ expense. That is not a problem in a fake democracy. The politicians fool the public and the media is in the hands of the rich.

But what happens if you completely abolish physical money and replace it with only digital claims on the central banks that issue the money? Not much, then you can even more easily convert debt into claims against the central bank. For example, politicians who constantly channel tax revenues and government assets to the rich (neoliberal robbery) and if their states go into debt as a result, can relieve them of their debt payments for a while so they can continue their robbery.

The central banks are now doing this with so-called “Quantitative easing (QE)”. It is an invention of the Japanese, who have also tampered with money on a large scale and built up huge debt to get out of stagflation. The central bank buys up existing debt securities from states that have ended up with the private banks, at the expense of the newly created assets in countries with central banks (ECB, FED), and this gives these private banks space again to issue new government debt securities to buy and the states space to to continue lending and distributing money to the rich.

Can’t you continue to create money by the ECB and FED indefinitely? No, because it is accompanied by an increasing impoverishment of the population due to an increasingly skewed distribution of wealth. Purchasing power suffers as a result, as a result of the real economy no longer growing, while the money supply continues to grow happily. In purely monetary terms nothing seems wrong, but in real terms people and states are getting poorer.

You see that all over the western world. I just watched a documentary about Korea, a very prosperous country you would think. But there, too, a social disaster is brewing due to the growing disparity in wealth between rich and poor. The number of suicides over 50 has increased dramatically. Continuous economic growth and impoverishment go hand in hand.

Anyone with an iota of common sense understands that money creation should be an exclusive government monopoly and not put into the hands of private loan sharks who are also above the law in our system. Incidentally, the Scientific Council has issued a fascinating piece of advice to return money creation to a state bank. Rutte has thanked him and promised to study it. Never heard of it again.

Banks’ money creation is the cause of the ongoing recessions. First they cast the net to let as many fish as possible swim in it. They pump up the economy by handing out cheap money, which leads to rapid growth, which in turn encourages even more investment, consumption and borrowing. If everyone is up to their necks in debt, they will bring the net back in by raising interest rates. Debtors are forced to pay off, high interest rates stop investment and consumption, and the economy collapses. When enough debt is paid off after years of belt-tightening, the next round begins. These methods of usury cause great misery, but our rulers have only a selective conscience.

[Reactie gewijzigd door Elefant op 5 februari 2022 03:22]

Leave a Comment