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For or Against Usury

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  • Sat, Jan 30, 2010 - 08:49am

    #11
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    Re: For or Against Usury

Usury is the most powerful human force ever invented, having built the most powerful empire in history.  All major religions warn against it.  But the secular case to be made is even more powerful.  It is the basis of exponential growth, which everyone on CM understands.  It’s also the cause of ever-increasing centralization, ever-increasing scale, and ever-increasing velocity of the system.  These 3 issues are why both parents must work now, lower class parents need multiple jobs in order to feed their kids, small farmers and main street businesses have been destroyed, many lament their lack of free time for rest and joy, many despise their endless commutes to jobs they hate working for mega institutions, many parents don’t have time for their kids, the lower classes have no wealth only debt, people numb their minds with TV or see a therapist because the system is so massive they have no freedom or autonomy to do anything about it, etc etc etc.

 

  • Sat, Jan 30, 2010 - 08:51am

    #12
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    Re: For or Against Usury

I was wondering who on this site thinks Usury (interest) is a good thing?  Now I’m not talking about interest you get on your savings or CD’s but on loans people take out.

The practice of usury should be completely outlawed.

When a bank gives you a loan for a house, car or small business, it technically does not have the money to back up the note/loan.  

And even if you take them to court, you cannot force the bank to pay because their promise to pay is not court enforceable.  What backs the note is the collateral pledged (your property).  Our property is what backs the money.

So why should a person be obligated to repay P+I when they (the bank) technically never had P to begin with through the practices of Fractional Reserve Banking?

Why should we have to pay them back when they didn’t loan you anything in the first place.  Numbers (that’s all they loan us is simple numbers in a checking account) do not consist of any tangible object.  A better way of saying it is that numbers do not consist of any known chemical substance.  So if a person doesn’t loan you anything, why would you be obligated to give him anything back other than what he loaned you?

I think we should end usury on Loans for Houses, Cars, Businesses and College.  

You’re off to a great start!  But now we need to figure out how to plug the gap here because 100% of the money supply comes into exsistance through and extention of credit by the banking system, and when that princple is repaid it is extinguished.  We need to figure out a way to replace all the interest bearing usury debt money with debt free, wealth money.

Now the argument is that “that is how banks make their money”, but that also makes no sense to me when they have the power to make the currency available on demand with a few key strokes and book entries.  

Banks “make” money every time they issue a new loan.  Banks do not create any currency, they only create book entry money.  100% of the currency is produced and sold direcly to the banking system by the U.S. Government.  This brings up a really good point though.  Banks can create as much credit as they wish.  There is no limit the the amount of book entries they can make.  Now the question is how do we force the banking system to create those numbers and final payment and move them into circulation without debt and all based on wealth with no taxation.

The issue of Debt free monetary systems has never been discussed in the media at all.  I was also wondering if this done for the very specific reason to purposely not inform the public?

Great question.  This gets right down to the heart of how the bankers control everything.  Because nearly everyone is in debt to the bankers they have an obligation to perform for the bankers.  If a certain media outlet began to run stories against the banking system all the banker would have to do is call in his loan, or raise his interest rates and put the squeeze on them.  The only power the bankers have is over the creattion of the medium of exchange as interest bearing loans and the power that comes with having everyone owe you.

 

How can a bank go out of business, when any expenses can be covered and created just like the loan was, out of thin air?

Because there is a rule within the banking system that when a loan goes bad that bank has to take money (numbers) from their income account and apply (destroy) it to the remaining prinicple part of the loan that has quite performing (paying).  When the amount of bad loans exceeds the bank’s income they are insolvent and out of business.  This rule does not apply to all banks, just the bulk majority of them.

Banks should be a public utility to benefit the people not the bankers since they charge interest on $$$ they never had to begin with.

Well I believe banks should be regulated into honest and moral prinicples, and not be allowed to perform their theft by decpetion practices as they do now.  I think they could and should remain private but should have to generate their profits from services provided (check clearing, account service fees) not from creating the medium of exchange as interest bearing loans.

It’s refreshing to see someone open to the idea of having money in circulation that doesn’t have to be borrowed in order to exsist.  If we can get more of this type of thinking we might just have a monetary system that works for the benifit of the people instead of a money system that only works towards the benifits of the few, as it is now.

  • Sat, Jan 30, 2010 - 08:58am

    #13
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    Re: For or Against Usury

Strabes is correct.

Usury is the most powerful human force ever invented, having built the most powerful empire in history.

The single best tool to manipulate and control and entire nation for the complete benifit of the few is to allow the creation of the medium of exchange as interest bearing loans.

Nearly 100% of the ills we face in our society are a direct consequence of our monetary system.    Like Strabes said, this money system is why people have to work harder and longer and get less and less, because by the very nature of this fraudulate debt based monetary system is that is it designed to transfer all the real wealth from the many to the few.  It’s much like a ladder where the bottom rung gets knocked out.  Pretty soon more and more people get knocked off the ladder until the bulk of the society is completely poor and economicly destroyed and the few at the top are enriched beyond their wildest dreams.

 

Great posting Strabes.

  • Sat, Jan 30, 2010 - 11:49pm

    #14
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    Re: For or Against Usury

goes 211

Sheesh. If you’re going to criticize the idea of a non usury note you should at least have a better idea. Your list of things is so broad and utopian it isn’t really an idea at all its really more of a day dream.

1) No monopoly control over our money and therefore no single way to capture and corrupt the process.

What does that even mean and how would create an iron clad system that couldn’t be corrupted.

2) It would be very hard to finance a welfare/warfare state

How would it be ‘very hard’ through law? And who would make the decision about the definition of ‘welfare’.

3) Compatible with the constitution.

Kinda like the Patriot Act? The politician/bankers aren’t going for that on I can guarantee that.

4) States/Municipalities could still charge taxes in their own local currency and therefore make a market for it.

Like the Articles of Confederation we had before the Constitution? Yep that worked out great.

5) Hard money types would be free to transact in gold/silver but people that prefer fiat currencies would could use them.

So the two would always be equal? Somehow, by magic? One would never be valued higher than the other driving people to choose one over the other? I mean we already have that don’t we? Seems like most people use fiat. I wonder why?

The key would be that there would be no forced fungability between the currencies and therefore markets would spring up to find the proper conversion rates.

Again this was tried during the Articles of Confederation and was proved a disaster.

  • Sun, Jan 31, 2010 - 01:11am

    #15
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    Re: For or Against Usury

5) Hard money types would be free to transact in gold/silver but people that prefer fiat currencies would could use them.

So the two would always be equal? Somehow, by magic? One would never be valued higher than the other driving people to choose one over the other? I mean we already have that don’t we? Seems like most people use fiat. I wonder why?

No we don’t already have this.   Legal Tender laws and sales taxes/capital gains taxes prevent this.

2) It would be very hard to finance a welfare/warfare state

How would it be ‘very hard’ through law? And who would make the decision about the definition of ‘welfare’.

If you have a hard currency, then it’s hard to finance welfare/warfare because you have to actually collect taxes to pay for it.  You can’t secretly debase the money supply to secretly pay for it.

There seems to be confusion, there are 3 different things being mashed together that are related but completly different:

  • Usury (interest) – Generaly usury is used to refer to excessive interest.  At any rate, interest is a return paid on borrowed capital.  It could be any type of capital, hard currency, fiat currency, labor (ie. I’ll work 10 hours for you later if you work 9 hours for me now).
  • Fiat Currency – The USD, not backed by anything other than faith, as opposed to a hard currency that is backed by some form of commodity or asset.  Gold and Silver are a hard currency that can be used directly instead of via a paper representation, but you could have a hard currency based on any asset, just maybe not directly usable in a form like a coin.  The reason gold/silver or other metal is desireable because of it’s direct use and inability to counterfit.
  •  Fractional Reserve Banking – A method (fraud in my opinion) where a lender can lend out more than they have on deposit.  Note, this could be done with a hard or fiat currency.  The risk is that if too many people demand their money at one time, then a hard currency will become a fiat currency.

I think it’s important to keep these thing distinguished, as any system that doesn’t involve interest is fantasy and will fail.  Unless you say absolutely no loans for anything, then you can’t have a system without interest, since without interest, you won’t have any market influence controlling the use of capital to insure it is used wisely.   This is pretty much the system we have now since interest is set very low and the reason we have had the housing bubble.   The only way you get interest rates so low is because of a fiat currency in which those that are printing the currency can arbitrarily set the interest rate as opposed to  a hard currency where you have to intice the holder to lend the currency via a promise of reward that out weighs the risk.

 

  • Sun, Jan 31, 2010 - 02:29am

    #16
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    Re: For or Against Usury

[quote=Johnny Oxygen]

goes 211

Sheesh. If you’re going to criticize the idea of a non usury note you should at least have a better idea. Your list of things is so broad and utopian it isn’t really an idea at all its really more of a day dream.

[/quote]

So is the new standard that one should not criticize something unless we personally have a better idea?  I guess we should just shut down this site because I have not found anyone around here with all the answers to the Economy, Peak Oil, the Evironment….?  Seriously I thought this was a place to discuss these topics amoungst concerned citizens with different perspectives.

As I said earlier, I don’t have all the answers and I never claimed to have the one and only solution?  I also think this problem is bigger than one person or even a group of people.  I just stated my preference for a market driven solution as opposed to a top down solution.

I then go on to list a few of my reasons for thinking this way.  If they are not good enough for you, I am sorry.

[quote=Johnny Oxygen]

1) No monopoly control over our money and therefore no single way to capture and corrupt the process.

What does that even mean and how would create an iron clad system that couldn’t be corrupted.

[/quote]

When did I say that it would be iron clad and incapable of corruption?  It is my opionion that competition keeps the competitors honest and without competition, we generally have suboptimal solutions.  Why should there not be monetary competition?

[quote=Johnny Oxygen]

2) It would be very hard to finance a welfare/warfare state

How would it be ‘very hard’ through law? And who would make the decision about the definition of ‘welfare’.

[/quote]

I assume our elected officials would make the decision but without the ability to indirectly steal from us by debasing the currency it would be impossible to run the fiscal insanity we currently have.

[quote=Johnny Oxygen]

3) Compatible with the constitution.

Kinda like the Patriot Act? The politician/bankers aren’t going for that on I can guarantee that.

[/quote]

Are we looking for the Banker’s permission?  As for the politicians, they will either come to that conclusion or it will eventually be forced upon them by the market or a societal collapse.

[quote=Johnny Oxygen]

4) States/Municipalities could still charge taxes in their own local currency and therefore make a market for it.

Like the Articles of Confederation we had before the Constitution? Yep that worked out great.

[/quote]

Like I said a warfare state would be pretty hard to maintain.  Would they have failed if not for war with England?  The US defense spending is now greater than the rest of the world combined.  Personally I would like for the US to stop being an empire and go back to a humble republic.  You must disagree.

[quote=Johnny Oxygen]

5) Hard money types would be free to transact in gold/silver but people that prefer fiat currencies would could use them.

So the two would always be equal? Somehow, by magic? One would never be valued higher than the other driving people to choose one over the other? I mean we already have that don’t we? Seems like most people use fiat. I wonder why?

[/quote]

Why?  When someone sticks a gun to my head and says use fiat, it kind of has that effect.  Are you not aware of how PM conversion gets taxed as capital gains?  Uncle Sam taking a bit cut out of the conversion kind of makes it impractical don’t you think? 

If fiat is so great why do they need to use force against the alternatives?

[quote=Johnny Oxygen]

The key would be that there would be no forced fungability between the currencies and therefore markets would spring up to find the proper conversion rates.

Again this was tried during the Articles of Confederation and was proved a disaster.

Look if your going to crap on someones ideas at least know what your talking about.

[/quote]

Who is crapping on who?  Like I said earlier in this thread.  It would be nice if debt free money advocates would bother to think about what the otherside is saying.

  • Sun, Jan 31, 2010 - 02:42am

    #17
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    Re: For or Against Usury

No we don’t already have this.   Legal Tender laws and sales taxes/capital gains taxes prevent this.

You can transact in gold and you can transact in fiat its just a matter of conversion. My point is that one currency will ‘win out’ over the other eventually.

If you have a hard currency, then it’s hard to finance welfare/warfare because you have to actually collect taxes to pay for it.  You can’t secretly debase the money supply to secretly pay for it.

This is lawyer speak. Define your version of ‘hard currency’. Is that FRN? Gold coin?

Tax collection? You have a hard time collecting taxes from ‘hard currency’? What about property tax, sales tax, income tax, etc? Are you saying that if you used hard currency it would somehow become harder to collect these taxes from you? You write later on:The risk is that if too many people demand their money at one time, then a hard currency will become a fiat currency. This removes your argument about hard currency being taxed.

Usury (interest) – Generaly usury is used to refer to excessive interest.  At any rate, interest is a return paid on borrowed capital.  It could be any type of capital, hard currency, fiat currency, labor (ie. I’ll work 10 hours for you later if you work 9 hours for me now).

Nope. Excessive interest? What the heck is that? Interest is a return on borrowed capital? Where is the capital when the bank creates the money out of thin air? There never was any ‘capital’.

I think it’s important to keep these thing distinguished, as any system that doesn’t involve interest is fantasy and will fail.

It worked for thousands of years until the bankers began the process of usury. Lincoln’s greenback work well to and it was considered to make all American currency non-usury until the bankers shut it down.

as opposed to  a hard currency where you have to intice the holder to lend the currency via a promise of reward that out weighs the risk.

More lawyer speak. How is this different from our fiat system? Explain what you mean.

  • Sun, Jan 31, 2010 - 03:38am

    #18
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    Re: For or Against Usury

[quote=Johnny Oxygen]

Usury (interest) – Generaly usury is used to refer to excessive interest.  At any rate, interest is a return paid on borrowed capital.  It could be any type of capital, hard currency, fiat currency, labor (ie. I’ll work 10 hours for you later if you work 9 hours for me now).

Nope. Excessive interest? What the heck is that? Interest is a return on borrowed capital? Where is the capital when the bank creates the money out of thin air? There never was any ‘capital’.

[/quote]

How many times do we have to say something for you to listen?   We don’t want banks (or anyone else for that mater) making money out of thin air!  We agree that when they do, they are charging interest on money that they created for free which is the ridiculous system we have now.

  • Sun, Jan 31, 2010 - 04:06am

    #19
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    Re: For or Against Usury

We don’t want banks (or anyone else for that mater) making money out of thin air

Then how do you suggest we have money created?

  • Sun, Jan 31, 2010 - 04:11am

    #20
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    Re: For or Against Usury

If you have a hard currency, then it’s hard to finance welfare/warfare because you have to actually collect taxes to pay for it.  You can’t secretly debase the money supply to secretly pay for it.

This is lawyer speak. Define your version of ‘hard currency’. Is that FRN? Gold coin?

Johnny,

I believe goes211 means Commodity Money when he says hard currency. 

Is this what you mean Goes211?

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