Money, law and banks

[FZR1KG]

This little series may be enlightening to some.
Hope it is for you.
It's about where money comes from, how its created, why law were changed to facilitate the creation of a product that is ultimately unsustainable, iow pretty much immoral laws designed to benefit those with control over money.
It explains why there is a ever growing debt, and short of introducing a new monetary system it is a debt that can only ever grow.
Oh, also explains way better than I ever could why interest on loans is pure evil and why I hate debt.
It is really long though but worth watching even if you just learn a little about how you're being screwed everyday.
Some nice history stuff in there too.

Money as debt Pt1

Money as debt Pt2

money as debt Pt3

[Cyborg Girl]

Oh, also explains way better than I ever could why interest on loans is pure evil

IIRC the Bible says this is usury, end of story. And for a while historically most Christians held to that.

You know how I feel about most religions, mind. But I often wonder if there are legitimate social reasons for such things being considered sinful, aside from tribal unity and whatnot.

I would bet that, at some point lost in the mists of time, some kingdom's economy went kablooey from unregulated loan sharking; and whoever wound up writing that part of the Scripture thought to himself, "Hey, maybe God doesn't like people making money that way..."

[Rommie]

Oh, also explains way better than I ever could why interest on loans is pure evil

IIRC the Bible says this is usury, end of story. And for a while historically most Christians held to that.

You know how I feel about most religions, mind. But I often wonder if there are legitimate social reasons for such things being considered sinful, aside from tribal unity and whatnot.

I would bet that, at some point lost in the mists of time, some kingdom's economy went kablooey from unregulated loan sharking; and whoever wound up writing that part of the Scripture thought to himself, "Hey, maybe God doesn't like people making money that way..."

And that's why Jews are evil- they didn't realize interest is evil.

No really, I think a loan and interest like anything else isn't bad in itself, just what people do with it- it is really fucking nice that if you want to start a small business and it will succeed you can go out and do it instead of the idea wasting away, for example. The problem IMO is we've moved to a realm where it's common to go into debt for every little friggin' thing, even ones you don't need, and yes in such circumstances it gets hard to dig yourself out far too quickly for many.

[FZR1KG]

No really, I think a loan and interest like anything else isn't bad in itself, just what people do with it- it is really fucking nice that if you want to start a small business and it will succeed you can go out and do it instead of the idea wasting away, for example. The problem IMO is we've moved to a realm where it's common to go into debt for every little friggin' thing, even ones you don't need, and yes in such circumstances it gets hard to dig yourself out far too quickly for many.

It's not that we go into debt for everything, it's that compound interest is bad.
It is a system that is not sustainable.
Ultimately it is a transfer of wealth system.
Money goes from the bottom to the top.
It is also a scheme that causes increasing debt that is impossible to pay off.

Take this simple example, you buy a house with a mortgage. The interest you paid to own the house in many cases is worth more than the house itself. Where does that money go?
It goes up to the banks. Almost every time people buy using credit they give the banks as much money as they paid for the loan. Often much more. Here's a question that needs answering, where does that money come from?

In any case, the net result of this over time is that the banks will end up having more money than all the combined assets that exist in the world. There is no other possibility when every person is giving the bank as much money as they are loaning.
We have long since passed that point. There already is more money than the value of Earthly things (physical assest, property, cars, houses, boats etc) by a huge factor.
Look at the debt the USA has. Its debt is greater than its GDP and this is the result of compound interest siphoned from the economy.

The system works based on a perpetually growing economy. It's an exponential function. We know mathematically that can't be stable and at some point something will give.

The fundamental problem is this, loans based on simple interest can be paid back because the interest is basically a fee for service. That is the case for all services. Your wage for example is your fee for your service.
With compound interest it's not a case of a fee for a service, it's an interest on that fee. That means there is no work being done to earn anything more than the amount that would be earned as simple interest.
Money is in effect making money in the form of debt to the person with the loan.

The nutshell of this is that the bank is making money. Now if they were printing money we'd all cry out that it's not sustainable. But because they don't print it we don't really pay much attention to it.
When counterfeiters print out money, they are punished if caught because its theft.
When banks do it its considered business.

The problem is that the amount of money in circulation is now greater with each loan.
Since productivity doesn't go up at the same rate this has the effect of devaluing the currency. We call it inflation.
As we know wages don't go up with CPI. The net effect is that the person with the loan is now paying back even more than the original calculated compound interest payout figure because they are paying it back with money that is depreciating relative to the original debt.

It's a system that simply cannot work in the long term.
In the past when things got so out of hand what happened was the person with the money would do perform an act of debt forgiveness. Things would go back to the starting line again and cycle up.
In this modern age where money is God, there is no forgiveness.
The only forgiveness IMHO that there should be is the people forgiving those that are defrauding the system by not stringing them up because they know the system is screwing everyone and don't care that they are doing it.

It gets even more complex when you consider how the banks operate in unison with each other. When you take out a loan for a mortgage for example, they don't give you money that they have. They create new money based on your promise to repay that debt.

Lets take a simple case example where there is only one bank in the world. When you buy a house with a loan they write you a cheque which you pay to the person that currently owns the house. You move in to the house, the previous owner gets a cheque and deposits it back into the same bank. Notice that the bank did not loan you any of its money.
You the new owner however are now paying the bank the same if not more money for the house you just "purchased".
When you finish paying the debt the bank then has increased the amount in its pocket the sum of the interest minus expenses. Effectively the bank has created money out of nothing that is now in the system.

Now I don't know about anyone else but the idea of paying 100% or more of an items value for someone to simply transfer ownership is ludicrous. The terms loan shark come into my mind, fraud, profiteering etc.

Now take that one bank scenario and put up a bunch of banks where they all have money tied into each others accounts and the system as a whole operates exactly like the system with one bank only.

That's why I hate the debt system and compound interest. The system is designed to take the money of the people and transfer it to the bank. That's what it does. That's what it is designed to do and that is not sustainable.
It is evil.

[Rommie]

Um, FZ, you realize wealth is created by other things in the economy that are not banks, right? Businesses that create products of value?

Further, your example of a loan for a house totally ignores the fact that your house isn't going to just stay the same value indefinitely- odds are the house is going to be worth more than what the loan was once you pay it off when you sell it. I know we can argue housing bubble stuff right now, but I'm thinking of normally how the system works like how parents bought a house in Pittsburgh which never had a bubble, and sold it for several times more than the initial loan/ 17% interest rate was in the early 80s. Sure the bank got a lot of money out of it, but my parents also got a home for 30 years and a nice retirement egg even after you take out the amount of interest they paid on it. This is a good thing.

(Interestingly until a year ago in the Netherlands when you bought a loan for a house the government would pay your interest in advance, and you just had that amount taken out of your selling price when you sold the house. It made mortgage payments ridiculously cheap, but also spurred the housing market to over-inflate and crash in value, so that's why they got rid of it and now it's just like any other country. Not sure why I'm mentioning this.)

I guess my point is yes, banks make money, but you seem to not mention all the wealth created elsewhere in the system at all. And even if banks are take a bigger wedge of the pie, that is still the brunt of the economy.

Mind, I'm a pretty awful consumerist in that I never buy anything (hell I save my money to travel abroad with it), and am really busy with other stuff I should be doing instead of posting here, so if there's a nuance or two in your wall of text I overlooked then forgive me.

[SciFi Chick]

...so if there's a nuance or two in your wall of text I overlooked then forgive me.

'wall of text' Subtle, Rommie, very subtle.

[FZR1KG]

Um, FZ, you realize wealth is created by other things in the economy that are not banks, right? Businesses that create products of value?

Sure do.
Money has and always will be based on the promise to pay.
If you make something, someone gives you a promise to pay, it usually comes in the form of money.
That's what money is.
To give you an idea, when you take out a mortgage what you are doing is giving the bank a promise to pay.
Effectively you are giving the bank money. Your mortgage is currency that you created by your signature of a promise to pay. That's why banks can sell mortgages to other companies and why they do.
To repay that debt you work. You exchange your time for money.

There are a lot of things I've left out. I have to. I could write for a year to cover it all.
What I'm concerned about is the problem in the money lending industry.

Further, your example of a loan for a house totally ignores the fact that your house isn't going to just stay the same value indefinitely- odds are the house is going to be worth more than what the loan was once you pay it off when you sell it. I know we can argue housing bubble stuff right now, but I'm thinking of normally how the system works like how parents bought a house in Pittsburgh which never had a bubble, and sold it for several times more than the initial loan/ 17% interest rate was in the early 80s. Sure the bank got a lot of money out of it, but my parents also got a home for 30 years and a nice retirement egg even after you take out the amount of interest they paid on it. This is a good thing.

Not that I can see. Your parents were screwed over by the price paid for service but they probably didn't know just like most people still don't.
Honestly, how can anyone think that paying over double the asking price for something is a good investment?
Sure they got to live in the house for 30 years. They paid for that.
Take the option to rent for example as a counter to that mortgage.
Rent rates are lower on a per month basis. Otherwise there would be no rental market unless it was manipulated.
Had they rented the same house for 30 years they would have paid less, had to repair less since that's the landlord's responsibility and could have saved the difference. Net effect they would have come out better off. They have actually done studies in Australia that show its economically wiser to rent and save than buy a house with a mortgage.

I guess my point is yes, banks make money, but you seem to not mention all the wealth created elsewhere in the system at all. And even if banks are take a bigger wedge of the pie, that is still the brunt of the economy.

The other places where wealth is made comes in the form of either materials or services or a combination.
If that's all the wealth created then there is no way that the sum of money can go higher than the natural resources be they material or be they human work.
The problem is when money is created out of thin air.
And that's what the banks are doing.
They aren't the brunt of the economy, they are the reason we have cycles of crashes regularly.
They take and don't create anything other than money (which causes inflation) and that is akin to being the worlds biggest counterfeiters.
The best way to describe their current behaviour is that of parasites.
We are not reliant on them. They are reliant on us.
Don't believe me?
Ask what would happen if everyone wanted to withdraw all their savings from the banks and wanted it in a physical commodity. The system would crash. It can only crash if the banks write more cheques than can be cashed. IOW, they have created money that doesn't exist in any plane other than their books.
Once upon a time banks had to have in gold what they wrote out in cheques.
Then they changed that to allow them to write cheques 2:1 of the gold stores they had.
Soon they had 9:1
Now they write cheques based on the promise to pay forms we the people give them in the form of mortgages and other loans.
Problem is, it can't be cashed.

Mind, I'm a pretty awful consumerist in that I never buy anything (hell I save my money to travel abroad with it), and am really busy with other stuff I should be doing instead of posting here, so if there's a nuance or two in your wall of text I overlooked then forgive me.

No need to appologise.
This is a very long involved discussion so for me to address the problems of the world economy in one post would be a mean feat. Which is why I posted the video's. Not all of which I agree with I'll add but it makes some extremely good points for people that don't understand how the money market works.

What I can do is address the biggest problem. Which is what I'm doing.
That being, a system that relies on an exponentially growing money base in order to maintain stability is not feasable.
It's a problem that has been known about by a lot of people, politicians, economists, bankers, royalty and some members of the public for millenia not centuries. To top it off, it requires compliance of both the people and the government to maintain a legalised oligopoly and police to enforce it.
It's been predicted that this issue will come to a point where it will eventually be the people vs the banks.
It's not that far off now. People see there is a problem, they just can't identify it. The whole Wall St movement was just the beginning. Things are not going to get better, they are going to get worse.

Look at the wealth disparity that constantly grows, the debt that constantly grows and then look at the amount of money in the system and how it constantly grows. There is only one way to reconcile these things.
And these things are all related for a reason.

My appologies on the second wall of text but I am trying to build a palace for myself.

[FZR1KG]

And that's why Jews are evil- they didn't realize interest is evil.

Actually I think the reason why Jews get a lot of the bad press is not because usury is allowed, but because of the way it is allowed:

The Hebrew Bible regulates interest taking. Interest can be charged to strangers but not between Hebrew.

Deuteronomy 23:19 Thou shalt not lend upon interest to thy brother: interest of money, interest of victuals, interest of any thing that is lent upon interest.

Deuteronomy 23:20 Unto a foreigner thou mayest lend upon interest; but unto thy brother thou shalt not lend upon interest; that the LORD thy God may bless thee in all that thou puttest thy hand unto, in the land whither thou goest in to possess it.[19]

Israelites were forbidden to charge interest on loans made to other Israelites, but allowed to charge interest on transactions with non-Israelites

If the above is actually put into practice, the net result is extremely racist, unethical and will create a class division between Jewish and non Jewish people.

The fact that the most wealthy and powerful international bankers happen to be Jewish helps reinforce this view.

As George Soros said:

At a Jewish forum in New York City, November 5, 2003, Soros partially attributed a recent resurgence of antisemitism to the policies of Israel and the United States, and the role of wealthy and influential individuals:

There is a resurgence of anti-Semitism in Europe. The policies of the Bush administration and the Sharon administration contribute to that. It's not specifically anti-Semitism, but it does manifest itself in anti-Semitism as well. I'm critical of those policies ... If we change that direction, then anti-Semitism also will diminish. I can't see how one could confront it directly ... I'm also very concerned about my own role because the new anti-Semitism holds that the Jews rule the world ... As an unintended consequence of my actions ... I also contribute to that image.[89]

In a subsequent article for The New York Review of Books, Soros emphasized that

I do not subscribe to the myths propagated by enemies of Israel and I am not blaming Jews for anti-Semitism. Anti-Semitism predates the birth of Israel. Neither Israel's policies nor the critics of those policies should be held responsible for anti-Semitism. At the same time, I do believe that attitudes toward Israel are influenced by Israel's policies, and attitudes toward the Jewish community are influenced by the pro-Israel lobby's success in suppressing divergent views.

George Soros is a billionaire Hungarian Jew. The family changed its name in the WWII era to avoid persecution. They were poor at that time and it was George that made the wealth of the family later in life. As a child he helped other Jews by passing messages to them informing them of what was happening. He is also a big philanthropist and once quoted as saying that he'd spend his entire fortune if it would guarantee that GW Bush would not get re-elected.
You just gotta love the guy! LOL

The reason I posted this is because there is a lot of anti-semitic views regarding banking and wealth.
By a lot I mean it's really hard to get information without running into it constantly.
While researching the whole money trade I found way too many antisemitic views. People blaming Jews for the way the market is rather than blaming the system of money making.
It's a case of a few people being in the right place at the right time and made their money within what the law allows.
Blaming a particular race for that is stupid. The blame rests with the people that made the laws that allowed the situation to begin with and they are long since buried.
So instead of blaming, what we should be doing is making people aware of the situation and trying to do something about it.

Trying to do that with the antisemitic pro NAZI chorus constantly in the background is really freaking hard because just by agreeing with a small selection of their views (that there is a problem in the money market) anyone can be lumped in with them as being antisemitic and thus not taken seriously even though the person totally disagree's with why the problem is there.

Another wall of text...now I have three sides I have my fortress if I shape it into a pyramid. LOL

[FZR1KG]

If anyone wants to read what a sociopath antisemitic NAZI thinks like, be warned it's not pretty but it's more regarding her sociopath views regarding money than antisemitism, you can read here:
http://www.spiritualeconomicsnow.net/so ... w_I_08.pdf

While it's hard reading I forced myself through half of it so I can understand just what kind of freaks are out there and how to identify them faster. Being screwed by three sociopaths so far we're not interested in a fourth time.

For the record, TSC, she's living in Canada. You should find this low life criminal and have her jailed. I place this task in your hands.

Hey, its not a wall of text!
It'll fit as a roof for my pyramid though.

[FZR1KG]

Now this I can get behind!
http://en.wikipedia.org/wiki/JAK_members_bank

A bank that loans interest free loans to members.

According to JAK's philosophy, economic instability arises out of and is a consequence of the levying of interest.

JAK operates under the following principles:

Charging interest is inimical to a stable economy
Interest causes unemployment, inflation, and environmental destruction
Interest moves money from the poor to the rich
Interest favours projects which yield high profits in the short term
The ultimate goal of JAK is to abolish interest as an economic instrument and to replace it with instruments that are in the best interests of the people. The main aim of the bank is to provide its members with a viable, feasible financial instrument, sustainable for the environment and serving the local economy.

The USA desperately needs one of these.