Fatal Flaw in Logic of the Crash Course?
At the risk of flogging the dead horse…
However, the perpetual expansion as a requirement of modern banking is the key concept to debunk our monetary system as a Ponzi scheme by design. Fujisan and others assert that it is very easy to disproof the formal ‘is a requirement’-claim.
Nonetheless, the assertion is not a moot point since it defines if the system is destined to collapse by design or by its imperfect manifestation.
To put it simply: fraud or not fraud?
For my part, I’m not convinced by Fujisan’s disproof-math since I figure the math is based on suppressed evidence: the math does not account for the cost of the money base used.
Debt based money needs debt to exist. No Debt – no money. No debt without interest. Thus, all debt-money in existence generates constantly interest expenses. The amount of money and the amount of debt must correspond to each other at any time. The amount of available and anticipatory debt coverage is finite; noncompliant to economists’ beliefs, the diameter of our planet refuses to grow. The system is destined to collapse by design.
To run a bank, a bank needs money. So no matter what, the banks needs some income to cover their costs. Furthermore, you can bet a bank tries to make a profit, just as any other company would. For this reason alone, destroying money that comes in as interest is the last thing that banks want to do.
Up to the crisis all of the money that came into the banks was recirculated: what they didn’t need for operational costs or the pay to their own deposit holders and creditors, went either to their shareholders or was lend back into circulation. You see: no money destroyed anywhere, and a growing amount of debt. Granted: interest makes the growth of debt possible, but the growth is not necessary. Even now, no money is really being destroyed, but kept in reserves to be lend out at a more profitable time.
The real problem is that the economy has grown too dependent on credit: people are loosing jobs right is because their salaries where payed indirectly form loans made to somebody else; companies where profitable only because enough money was lend to pay for all the profits and so on and so on. An economy doesn’t need to be so imbalanced, but since it is, every drop in the growth of debts is followed by a drop in economic activity.
The simplistic explanantion of how interest drives growth is fatally flawed: it has nothing to do with reality. It shows no interest in how banking really works, and in the true reasons for our problems. It will therefore never lead to any solutions, but just to the unfolding of God knows what agendas the fairy tale tellers have.
I can’t make head or tail of your statement.
… Granted: interest makes the growth of debt possible, but the growth is not necessary. Even now, no money is really being destroyed, but kept in reserves to be lend out at a more profitable time.
As above-mentioned, as long as you maintain the debt, it generates interest. If you don’t maintain the debt, you can’t maintain the money. You cannot put it into the reserves for a while and embezzle the associated interest.
requires is debt. Debt generates interest. Interest which cannot be served by the initial debt, -ehm.. money. Otherwise, if we regularly subscribe to abnormal debt cancelation, we’re done with the debt-money.
Thus, ‘interest makes the growth of debt
How to maintain any kind of money, or any kind of financial system without paying for it?