Thread: Money = debt...and why it is designed to fail

pseudolus =
"It doesn't. It's prime purpose is to remove wealth from the people of the world to the people that own the banks. This is it."

BINGO ! Right you are pseudo.

quote Martin wolfe

Of course, the flip-side to this creation of money is that with every new loan comes a new debt. This is the source of our mountain of personal debt: not borrowing from someone else’s life savings, but money that was created out of nothing by banks. Eventually the debt burden became too high, resulting in the wave of defaults that triggered the financial crisis.

Originally Posted by boloa

Originally Posted by koman

I've still got my money, and so does everybody else that I know

But do you???
In the good old days of the Gold/Silver standard your money was worth a certain amount of precious metal.
Now days with the FIAT system of Banking your money is just a promise...a primise to pay what????.......In most case's nowdays it's a ounce of Bullshit

Exactly. And still his protestations that I am not correct does not address the actual fact that all money is debt, and if I borrow 100 bucks, I get given 100 bucks and have to pay back 110 bucks. The 10 bucks is not created so the Private bank gets, for simply creating money, the 100 bucks back in salary money and also 10 bucks extra that has never been created so comes from me personally. They tap into a computer 100, and in return get 110 bucks in cold hard cash. This is the scam. This is the trick.

Problem is, its not about my 100 bucks. Its about the 18 trillion the US has in debt.

Originally Posted by pseudolus

Its about the 18 trillion the US has in debt.

And it's going up every second

U.S. National Debt Clock : Real Time

18 Trillion in debt.

And eventually, interest will rise, even though I think the Fed wants them very low for quite a while longer.

When interest rates do rise, the annual interest payments on the debt will increase and take a larger portion of government spending.

Eact 1% rise is about $180 more billion +, and each subsequent percentage raise is more than $180 billion added.

It's like a circle.

Originally Posted by pseudolus

OPK try again. I get a bank loan for 100 dollars. I GET 100 dollars. I have to pay back 110 dollars. Where does the extra 10 dollars come from in a country where all money is debt and has to be created as debt? Where?

Can this be serious? Are you really that warped? The interest (as I've explained before) is the "cost" of borrowing capital. There is an inherent cost to borrowing capital no matter where you get it. There is NO money exchanged; it's debits and credits which need to be balanced by some pre determined date. Banks are not charity organizations.

So in your very simplistic example, the hundred dollars is the principle (amount borrowed) and the extra ten is the interest on that principle. Nobody compelled you to borrow the hundred, but if you want it or need it, then there is a cost involved, just like most things in life for those of us in the real world.

The cost of borrowing along with the principle would need to be "earned" by you in order to pay it back (obviously). How you do this depends on what you do to pay for everything that you spend money on. I gather you do understand the notion of "earnings"

Playing with semantics does not change any of the realities of the finance business....so stop talking about "creating interest" because it makes no sense and the situation should be quite clear and simple even to a 12 year old.

Originally Posted by pseudolus

the basis of humanity is empathy, which you clearly lack.

More meaningless horseshit. Empathy with who or what?

Originally Posted by pseudolus

The world is full of selfish people like you unfortunately, the "i'm all right jack" who don't give a flying fuck about anything other that yourself and the people you chose to have around you.

Ah, I was wondering how long it would take you to get around to this kind of silliness. So, instead of answering a few very simple and direct questions to back up your nonsensical assertions (because you can't), you wish to imagine me to be a member of the illuminati or some fucking thing.....

Try again. How did the banks miss me and everybody else that I know. How are they taking all this money from the "people of the world".....many of whom don't have any money to take anyway?

If it were not for these banks you abhor so much, I would never have been able to buy houses, cars, boats or run a successful business. I, and everybody else that I've ever known would probably have spent our lives trying to trade pork for potatoes or fixing cart wheels for bread and milk.

That's the way the world used to be.....before the advent of the monetary system and the bankers.....and this is the system you wish to abandon in order to go back to pre 11th century living.? Then all these poor people you claim to champion would really have something to worry about...

So, come on....how are you going to fix the system? Who should control the money? What replaces a bank?...and who should manage it.

Should be a piece of piss for you with all that knowledge you've gained from RT and Max the comedian....

Oh this is gonna be good...

Originally Posted by Black Heart

18 Trillion in debt.

And eventually, interest will rise, even though I think the Fed wants them very low for quite a while longer.

When interest rates do rise, the annual interest payments on the debt will increase and take a larger portion of government spending.

Eact 1% rise is about $180 more billion +, and each subsequent percentage raise is more than $180 billion added.

It's like a circle.

Yes, it's a big debt, but it's also a big economy. Again, what's most important is the ability to service and manage the debt, rather than the debt itself. Interest rates are unsustainably low in the long term so yes, the debt will become more of a burden as time goes on.

However, look how this debt was accumulated. Governments at every level have been over spending, year after year. The only places governments can get money is though taxation (which can lose them the next election) or borrowing against future tax revenues.

The citizens demand more and more services from their governments at ever increasing cost and at each level, but they don't want to pay any more taxes.....so ...the citizen has endlessly increasing expectations and many live well beyond their own means. Then they compel their government to live beyond it's means, and over time you end up with this big number outstanding from all those years of over spending. There is no single culprit when it comes to assigning blame for the US national debt....but it's a lot easier to just point fingers than look at the total package.

Part of the difficulty with this kind of subject on an internet forum is that it's just way to diverse and complex to have a real discussion. People try to over simplify with catch phrases and buzz words gleaned from internet sources that are often just shill sites for one political viewpoint or another ....and the whole thing gets bogged down pretty quickly....as we now see.

Originally Posted by koman

Governments at every level have been over spending, year after year.

That is a sound bite straight from GOP talking points and complete bullshit. Sure of recent the overspending is mainly due to two wars and military spending.

The debt has exploded due to constant tax cuts that started with the Reagan presidency and its failed policy of "trickle down" economics. Just the Bush tax cuts alone has piled on 6.6 trillion to the debt.

Pseudolus

1) Have you never borrowed money to buy a house? If so, why, given your belief in the evils of usury?

2) Are you reading anything apart from David Icke books nowadays?!!

Originally Posted by bsnub

Originally Posted by koman

Governments at every level have been over spending, year after year.

That is a sound bite straight from GOP talking points and complete bullshit. Sure of recent the overspending is mainly due to two wars and military spending.

The debt has exploded due to constant tax cuts that started with the Reagan presidency and its failed policy of "trickle down" economics. Just the Bush tax cuts alone has piled on 6.6 trillion to the debt.

Ahem........spending on wars would come under the general heading of "over spending" I believe. ...and tax rates do determine the amount of revenue the government has to spend, apart from borrowing.....so how is it BS Snubbie? My point was simply over spending and not the various reasons for it.

Also, there is the small missed point that municipal and state governments have been over spending as well. (actually, that was one of my main points).

I mean California has not launched any wars recently and the state government is still fucking broke along with a whole bunch of other states. We won't even bother with places like Detroit.....which have yet another level of "government" and there are numerous municipal governments that are beyond broke....although I'm not aware of any wars in any of these places. War, being a kind of Federal responsibility and all that.

This thread is actually about money, credit, leverage. debt and things of that ilk ...which are common to all political persuasions....and the rather peculiar revelation that somehow banks are stealing all the money from the people of the world for themselves...

Sorry Snubbie....you're off an a bit of a new trajectory there.... and I do believe we've had this kind of " Bush and Regan vs the world of Snubbie" discussion before somewhere..... good try though.....

Originally Posted by The Ghost Of The Moog

Pseudolus

1) Have you never borrowed money to buy a house? If so, why, given your belief in the evils of usury?

2) Are you reading anything apart from David Icke books nowadays?!!

IN answer to your questions, I own a house outright. I did not have a mortgage. Secondly I do not own any David Icke books nor have I spent huge amounts of time listening to what he has to say. As you are seeing a link perhaps I should despite that fact that clearly you are making a snide comment off the back your the mainstream medias presentation of him as opposed to what he actually has to say.

Originally Posted by koman

Can this be serious? Are you really that warped? The interest (as I've explained before) is the "cost" of borrowing capital. There is an inherent cost to borrowing capital no matter where you get it. There is NO money exchanged; it's debits and credits which need to be balanced by some pre determined date. Banks are not charity organizations.

The fact that you are sticking to that is frankly insane.

Cost of borrowing. Where does that come from?

All money is debt no matter how you try to twist it. All of it. They do not create the interest. Therefore debts can never be repaid. If you seriously want to continue thinking otherwise please point me to a country that has successfully repaid all its debt to the private banks.

You can see this is all a charade by the fact that big businesses now get zero percent loans because the banks know that they create fake money and it is repaid in real money so they win anyway. They are also offering negative interest rates to their extra special friends as well as they lend 100 bucks and only ask for 90 to be repaid! Why? Because that is still 90 bucks on their balance sheet in real money that they did not have before.

As for you ascertion that they "cancel out" on balance sheets that is perverse to suggest and you are proved categorically wrong by the rampant inflation in the western world that the media glosses over but hits you in the face when you venture back west for the first time in a couple of years and all prices are up 25%.

here's a cartoon for you which might help because if you are a banker your head will be so full of cocaine and lies you will appreciate the simple pictures.

Originally Posted by koman

My point was simply over spending and not the various reasons for it.

Did you not say overspending on EVERY level? It is not on every level.

Originally Posted by koman

I mean California has not launched any wars recently and the state government is still fucking broke

Wrong again. California has been running a budget surplus for a few years now.

California sees reserves growing more than $4 billion over two years | Reuters

Originally Posted by koman

This thread is actually about money, credit, leverage. debt and things of that ilk

It would seem to me that the OP really doesnt know himself what this thread is about. I was merely pointing out the flaws in your point.

Originally Posted by Neverna

^ Pseudo, I don't understand how "debts can never be repaid". If I lend you 1000 baht and you repay me 1000 baht or 1100 baht, the debt is paid, the same as if I borrow GBP1000 from a bank and repay the loan and the interest. I've done it before. I borrowed some money from a UK bank. I withdrew the borrowed money from the bank. I bought a car (paid cash). I repaid the loan plus the interest. I have no debts to that bank. It finished many years ago. Bank happy. Me happy. Finished. No debt.

Well FFS. of course that's exactly how it works. Pseudo keeps banging away about the banks not "creating interest"....and it's been explained just about every way possible but he still can't get his head around it.

It would seem likely that most of us have done the same thing with the same results and experience. How many people can buy a house or even a car without borrowing .....not too many...so not too many people would be able to own their house or have a car without taking on some temporary debt.

As far as countries never paying off their debts....that too is nonsense. The reason why debts remain is because countries, as well as corporations, tend to operate on a revolving line of credit type of arrangement. The debt is being paid off constantly, but also has new debt added on a regular basis as required, so the thing never reaches zero.

Clearly some countries and other large borrowers do a better job than others. Not a single bank note is printed in any of this activity. Credit and debit entries on a balance sheet.....and that's how whole nations great and small manage their economies as well as the world's largest and smallest corporations.

Pseudo is the only legal entity on the planet that has not used a bank apparently... How likely is that?.....

Originally Posted by bsnub

Did you not say overspending on EVERY level? It is not on every level.

I was referring to every level of government: municipal, state or (regional) and Federal (national)

Originally Posted by bsnub

Wrong again. California has been running a budget surplus for a few years now.

That's an annual budget surplus, which is good, but the state still has a massive debt load accumulated because of decades of budget deficits caused by reckless spending and sloppy controls.
Debt and deficits are not the same thing, although one is usually caused by the other. Increased taxation and reduced spending is the only way to fix problems like this....unless you find a 2nd Saudi Arabia in Fresno or something.

Originally Posted by bsnub

It would seem to me that the OP really doesnt know himself what this thread is about

On that point we are in total agreement....

Originally Posted by koman

I was referring to every level of government: municipal, state or (regional) and Federal (national)

Ok I did not catch that. For some reason I took it as within the context of the federal budget.

Originally Posted by koman

the state still has a massive debt load accumulated because of decades of budget deficits caused by reckless spending and sloppy controls.

Like you said before a big debt and a big economy. This is not a crisis.

Originally Posted by koman

Debt and deficits are not the same thing

I am well aware sadly most are not.

Originally Posted by pseudolus

I do not own any David Icke books nor have I spent huge amounts of time listening to what he has to say. As you are seeing a link perhaps I should despite that fact that clearly you are making a snide comment off the back your the mainstream medias presentation of him as opposed to what he actually has to say.

Do you wear purple?
Have you met any lizard men gallivanting around Pattaya?

(I may be joking but you started it!)

Originally Posted by boloa

Originally Posted by koman

I've still got my money, and so does everybody else that I know

But do you???
In the good old days of the Gold/Silver standard your money was worth a certain amount of precious metal.
Now days with the FIAT system of Banking your money is just a promise...a primise to pay what????.......In most case's nowdays it's a ounce of Bullshit

And even precious metals aren't as solid as they were of yesteryear....
The same jokers that control the very false and imaginary created wealth have their say so towards the value and worth these supposed standards allowing the complex illusion to enrich itself accordingly.

Aside from you Al and a couple of others, I'm truly amazed towards the handful of members that will continue to make their own satisfying logic buying into [even defending] an established hypnosis that is the power grid of fantasy.

Those who counter with any sort of reality are quickly dismissed for the good of the broader hocus pocus.

Originally Posted by pseudolus

Originally Posted by The Ghost Of The Moog

Pseudolus

1) Have you never borrowed money to buy a house? If so, why, given your belief in the evils of usury?

2) Are you reading anything apart from David Icke books nowadays?!!

IN answer to your questions, I own a house outright. I did not have a mortgage. Secondly I do not own any David Icke books nor have I spent huge amounts of time listening to what he has to say. As you are seeing a link perhaps I should despite that fact that clearly you are making a snide comment off the back your the mainstream medias presentation of him as opposed to what he actually has to say.

I quite like David Icke. I have a copy of his 'The truth shall set you free' & was reading it this afternoon. However, I surmise that if one read too much of it, one would become drunk on his diatribes.

Lucky you owning a house outright. I'm sure lots of other people wish they had the money to do that without borrowing. Perhaps if property owners were not so obsessed about the values of their houses being propped up to the extent that even a quarter of a million quid is an average price, young people would have a chance, without having to resort to a 30 year millstone.

Of course, if borrowing was capped - your house would fall in price, as property prices are merely a derivative of the cost of leverage, and somehow, I doubt you'd be smiling at that !

Originally Posted by thaimeme

And even precious metals aren't as solid as they were of yesteryear....

Understandable.

Originally they were you'd suppose the best way of carrying a large amount of cash in a small bundle.

Today though - perhaps money is starting to have its limits.

Farming/Food Production is a sure bet for your family and its future these days.

Originally Posted by koman

Originally Posted by Neverna

^ Pseudo, I don't understand how "debts can never be repaid". If I lend you 1000 baht and you repay me 1000 baht or 1100 baht, the debt is paid, the same as if I borrow GBP1000 from a bank and repay the loan and the interest. I've done it before. I borrowed some money from a UK bank. I withdrew the borrowed money from the bank. I bought a car (paid cash). I repaid the loan plus the interest. I have no debts to that bank. It finished many years ago. Bank happy. Me happy. Finished. No debt.

Well FFS. of course that's exactly how it works. Pseudo keeps banging away about the banks not "creating interest"....and it's been explained just about every way possible but he still can't get his head around it.

It would seem likely that most of us have done the same thing with the same results and experience. How many people can buy a house or even a car without borrowing .....not too many...so not too many people would be able to own their house or have a car without taking on some temporary debt.

As far as countries never paying off their debts....that too is nonsense. The reason why debts remain is because countries, as well as corporations, tend to operate on a revolving line of credit type of arrangement. The debt is being paid off constantly, but also has new debt added on a regular basis as required, so the thing never reaches zero.

Clearly some countries and other large borrowers do a better job than others. Not a single bank note is printed in any of this activity. Credit and debit entries on a balance sheet.....and that's how whole nations great and small manage their economies as well as the world's largest and smallest corporations.

Pseudo is the only legal entity on the planet that has not used a bank apparently... How likely is that?.....

Psuedo's model is correct.
If you give work output no value.
What he is continually failing to factor in is the 10 in interest is a credit swap for his labour.


Now, given how he thinks his labour may well be worth nothing, that might be what is confusing him.

Originally Posted by boloa

In the good old days of the Gold/Silver standard your money was worth a certain amount of precious metal.
Now days with the FIAT system of Banking your money is just a promise...a primise to pay what????.......In most case's nowdays it's a ounce of Bullshit

I promise to pay the bearer on demand the sum of five [xxx] pounds



From the Bank of England...

The words "I promise to pay the bearer on demand the sum of five [ten/twenty/fifty] pounds" date from long ago when our notes represented deposits of gold. At that time, a member of the public could exchange one of our banknotes for gold to the same value. For example, a £5 note could be exchanged for five gold coins, called sovereigns. But the value of the pound has not been linked to gold for many years, so the meaning of the promise to pay has changed. Exchange into gold is no longer possible and Bank of England notes can only be exchanged for other Bank of England notes of the same face value. Public trust in the pound is now maintained by the operation of monetary policy, the objective of which is price stability.

Bank of England | Banknotes | Frequently Asked Questions