Esoteric Dissertations from a One-Track Mind

September 25, 2007

Money As Debt

Filed under: capitalism, economy, politics — codesmithy @ 7:57 am

I found the above video enlightening to how the nation’s monetary system works.  As it should be apparent to anyone that has actually interacted with a bank, that it works quite differently than how conventional wisdom usually describes it.  One of the things that I like about the video is that the solutions it describes are actually sensible, compared to people that want to go back to the gold standard, although it has its share of monetary conspiracy quotes.

A floating currency tied to a democratic government, not handed off to a separate corporate entity, is likely the best way to go.  A money supply completely controlled by private interests is fine in theory, suicide in reality (conglomeration, rise of monopoly or cartels).

As the video points out, there is no difference between taxation and inflation since they both work to the practical goal of decreasing buying power.  People who vote Republican should keep in mind that large public debt will fuel future inflation.  Even if your taxes are low now, there will come a time to pay the piper.  It also must be understood that much of the current prosperity of the nation is borrowed, and puts the nation in strategic peril.  As always, the poor will be the ones most hurt when the time comes.

It is frustrating to watch big, sensible ideas such as election reform, nuclear disarmament, energy independence, and fiscal reform consistently fall by the wayside.  But somehow, inheritance taxes can take center stage.  The debate is so lilliputian in the grand scheme of things.  Although, the first priority has to be to get out of a state of war.  I don’t think citizens know how much this war is actually costing us because we haven’t reached the cliff yet.  There is a reason financial sectors are booming.  However, it should be obvious to anyone, that trading doesn’t fundamentally create wealth.  So, how are financial sectors making all this money?  Now, you should know the answer, and why Enron and the sub-prime crisis are just tips of a larger unsustainable ice-berg.

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