Will A Genital Wart Bleed Or Puss

public debt, private interests

On the question of interest and debt service.

As more and more exchanges in the blogosphere address this issue, I think it is useful to re-emphasize that the issue of repayment of public debt and the problem of managing money - and a wild growth - are largely related to the question of the level and the influence of interest rates. Outside
therefore responsibilities related to money creation, it seems necessary to establish rules for credit control (in addition to any rules of supervision of revenues).

I often supported the idea of an interest rate of "ethics": no rate (especially that of public debt) should be above the actual rate of growth anticipated for the economy, only way of not having a bath 'money' which empties faster than it fills, and prevent excessive growth of research with the sole purpose of paying off loans.

A little arithmetic (and the basic use of a spreadsheet ;-)) show (s) the thing so trivial

Taking a growth rate of 2% and an interest rate 5%, an elementary calculation (at constant velocity, and with interest rates and stable growth rates) over 20 years gives us the following results:

The first column is the year, the second column of M1 decreased to 100 initially (rising to 265 in 20 years).
The evolution of GDP figure in the third column (it starts with the value 384: in fact, everything should be multiplied by 3.15 for the 1800 billion euros of French GDP in 2008).
The fourth column measures the change in the ratio M1/PIB
The last column resets, so "smooth" evolution of GDP between 1989 and 2008 françcais: these are just orders of magnitude, of course, corresponding to a growth rate of "virtual" of 2%.

(We will show in another table the statistical evolution over 15 years - evidence, "official" - the monetary aggregate M1 over this time to cash ("Currency" = higher ticket items) )




In 20 years, an interest rate of 5% and a GDP growth of 2% of M1 increased from 26% to 46% of GDP GDP .

is another way of saying that the financial sphere will be enriched at the expense of the productive sphere , or that capitalists take advantage of unearned income at the expense of "workers", such as contractors 'proletarians'.

We also see, well, a 3% difference between these two rates leads to the general government deficit could never be repaid, at least to reduce expenditures and increase revenues (taxes?) Of state drastically, and therefore intolerable.

That's what many writers, including AJ and Ph. Holbecq Derudder had shown (see "Public debt, a profitable business ") and interest payments for 27 years, between 1980 and 2006, accounted for more than 1100 billion euros, while the debt itself has increased by 913 billion euros. Ssns these accrued interest - that is, if France had been able to create the corresponding currency, instead of borrowing from commercial banks - France, in late 2006, would have had more than 200 billion budget surplus, which would have allowed fully repay accumulated deficits during these 27 years ...

Without going so the exorbitant privilege granted to banks (the privilege of "fiat money beat" and priest able to state with 3% margin: Natixis is a ticket dated January 2010 has yet confirmed) - other tickets on this blog or elsewhere, having amply discussed, it seems useful to show that if M1 has increased relative to GDP, it was the same in similar proportions to the liquid-money (higher ticket items) but with relatively large fluctuations.

The following table will illustrate this point, this time in the context of the euro area (15 years, month by month figures in thousands of euros):

Period ↓ Currency appreciation M1 M1/Currency
2009Nov 750,109 4,462,083 5.95
2009Oct 745447 4484004 6,02
2009Sep 740640 4402728 5,94
2009Aug 741163 4399063 5,94
2009Jul 745471 4332559 5,81
2009Jun 734980 4236798 5,76
2009May 731994 4186899 5,72
2009Apr 729212 4193541 5,75
2009Mar 719947 4118806 5,72
2009Feb 715969 4129472 5,77
2009Jan 712336 4099616 5,76
2008Dec 722924 3974183 5,50
2008Nov 703740 3957568 5,62
2008Oct 698922 4004350 5,73
2008Sep 657204 3887351 5,91
2008Aug 656106 3850635 5,87
2008Jul 658825 3836504 5,82
2008Jun 652134 3845554 5,90
2008May 645772 3850976 5,96
2008Apr 641431 3837211 5,98
2008Mar 632928 3840488 6,07
2008Feb 628792 3840617 6,11
2008Jan 623208 3854044 6,18
2007Dec 638620 3830465 6,00
2007Nov 618703 3853032 6,23
2007Oct 613589 3842720 6,26
2007Sep 610528 3832355 6,28
2007Aug 610685 3838780 6,29
2007Jul 612964 3823959 6,24
2007Jun 605045 3790991 6,27
2007May 597697 3766299 6,30
2007Apr 594842 3745802 6,30
2007Mar 588596 3738977 6,35
2007Feb 578812 3709559 6,41
2007Jan 575735 3691691 6,41
2006Dec 592282 3685076 6,22
2006Nov 571587 3616325 6,33
2006Oct 567175 3598083 6,34
2006Sep 563264 3599260 6,39
2006Aug 559066 3580731 6,40
2006Jul 562779 3557871 6,32
2006Jun 553802 3559106 6,43
2006May 543680 3544348 6,52
2006Apr 540385 3517573 6,51
2006Mar 532322 3484658 6,55
2006Feb 524920 3464427 6,60
2006Jan 520930 3440421 6,60
2005Dec 532914 3422983 6,42
2005Nov 514488 3386468 6,58
2005Oct 510522 3377160 6,62
2005Sep 507149 3349436 6,60
2005Aug 500919 3328395 6,64
2005Jul 506427 3300974 6,52
2005Jun 496551 3254973 6,56
2005May 485829 3050521 6,28
2005Apr 481074 3026812 6,29
2005Mar 471751 3003462 6,37
2005Feb 463566 2990502 6,45
2005Jan 459893 2962631 6,44
2004Dec 468426 2906478 6,20
2004Nov 448753 2912272 6,49
2004Oct 444394 2885794 6,49
2004Sep 438041 2870081 6,55
2004Aug 433400 2838079 6,55
2004Jul 436246 2825754 6,48
2004Jun 423014 2793055 6,60
2004May 416623 2775026 6,66
2004Apr 409373 2777006 6,78
2004Mar 399591 2756923 6,90
2004Feb 393469 2719587 6,91
2004Jan 389117 2707860 6,96
2003Dec 397902 2677644 6,73
2003Nov 379148 2661724 7,02
2003Oct 371239 2656872 7,16
2003Sep 364830 2623085 7,19
2003Aug 362668 2608287 7,19
2003Jul 361475 2576327 7,13
2003Jun 351042 2559749 7,29
2003May 343756 2553842 7,43
2003Apr 336320 2526511 7,51
2003Mar 327218 2501963 7,65
2003Feb 319317 2483887 7,78
2003Jan 312120 2456046 7,87
2002Dec 341158 2443268 7,16
2002Nov 321353 2416183 7,52
2002Oct 313872 2388636 7,61
2002Sep 306676 2371262 7,73
2002Aug 301114 2340264 7,77
2002Jul 296574 2323232 7,83
2002Jun 285696 2305287 8,07
2002May 273847 2290992 8,37
2002Apr 261655 2272466 8,68
2002Mar 254298 2241293 8,81
2002Feb 240476 2249355 9,35
2002Jan 246680 2247259 9,11
2001Dec 239720 2223121 9,27
2001Nov 279707 2219348 7,93
2001Oct 295453 2202549 7,45
2001Sep 309607 2192127 7,08
2001Aug 319234 2171594 6,80
2001Jul 328033 2157842 6,58
2001Jun 333023 2156258 6,47
2001May 332902 2142987 6,44
2001Apr 336171 2124661 6,32
2001Mar 336281 2105802 6,26
2001Feb 335032 2106116 6,29
2001Jan 336070 2094886 6,23
2000Dec 348369 2025811 5,82
2000Nov 337698 2021191 5,99
2000Oct 337602 2022323 5,99
2000Sep 339817 2014125 5,93
2000Aug 338781 2022499 5,97
2000Jul 343909 2012884 5,85
2000Jun 342023 1997825 5,84
2000May 338382 2005859 5,93
2000Apr 338582 2022097 5,97
2000Mar 335456 2003226 5,97
2000Feb 331989 1988897 5,99
2000Jan 333840 1987997 5,95
1999Dec 350787 1923210 5,48
1999Nov 331071 1914637 5,78
1999Oct 330544 1900239 5,75
1999Sep 328282 1887809 5,75
1999Aug 327370 1878935 5,74
1999Jul 332861 1880658 5,65
1999Jun 324790 1857387 5,72
1999May 322403 1837747 5,70
1999Apr 320733 1820616 5,68
1999Mar 318574 1807938 5,68
1999Feb 313911 1787741 5,70
1999Jan 314331 1808480 5,75
1998Dec 323437 1732438 5,36
1998Nov 314284 1705466 5,43
1998Oct 313372 1681123 5,36
1998Sep 311823 1669227 5,35
1998Aug 315095 1660416 5,27
1998Jul 320715 1650839 5,15
1998Jun 315514 1656273 5,25
1998May 317279 1634368 5,15
1998Apr 314877 1626160 5,16
1998Mar 311850 1607042 5,15
1998Feb 311818 1585539 5,08
1998Jan 311449 1573311 5,05
1997Dec 320614 1565384 4,88
1997Nov 314712 1554021 4,94
1997Oct 311745 1550447 4.97 311131 1530295 4.92
1997Sep


ratio M1/currency, I called in other notes "Money" / "cash" has varied between 4.88 and 7.80 - apart from a period a little special, that of the euro's launch in late 2001/early 2002 - currently about to turn 6 (In France, changes in the ratio of "illiquidity" seem smaller, the ratio being himself m ^ me lower (currently around 5)).

This suggests two things, it would probably dig a little deeper.

a) A liquidity crisis if it occurs in the euro area, probably not begin not France, because there are relatively more tickets available (relative to paper money) in France and Europe - while, however, the use of bank money (through employment bank cards, checks or wire transfers) is at least as great in France than in the rest of the eurozone.

b) changes compared to M1 and cash ("currency") can not say whether the central bank or commercial banks that initiate the process of raising money. But the process of increasing the money supply is undeniable, accompanied by a similar increase in the amount of money Cash in circulation. These concomitant increases are greater in percentage terms than GDP growth, and seem to be explained, in large part by the interests not "ethical" levied by banks.

Comments welcome.

BL

Bottemless Women From Behind

again on the currency, censorship, disillusionment, sense-cons and realities

On the new single thought in the monetary field.

I thought not having to do more duty, dismantle certain practices, especially coming from someone who claims to champion the poor, the marginalized, state debt, and destroyer of thinking. And yet ... On a blog

known in the French blogosphere, that of Paul Jorion the following comment was posted by a "@ toad red" (February 5, 2010 at 20:44)

"Bravo for the demo! It is very much in the direction of "The Silver manual" which is based on the distinction between "real money" - paper money - and what is simply recorded as giving the impression of be money but that does not deserve the name change. Deposits are merely promises to pay, alias IOUs .. ")

I tried to answer this "Red Toad" the next thing:

You're right: The argument Voyer (author of the ticket denying money creation by private banks) is well within the meaning of the words of Paul Jorion in the " silver, Manual ". The only difference is that Voyer has no literary talent of Paul, and that his arguments are much more boring, so even more objectionable, BL

Comment removed, which act.

course, Paul Jorion has the right to do whatever he wants on his blog: he might just have the decency to write any argument - it was courteous and 'civilized' - in opposition to my ideas will be banned from my blog.

I will say here, in terms courteous and civilized, which to me seems "preposterous" in the theses of Jorion - and Voyer (which is as grammarian, trading, accounting and ... philosopher, since for him "Accounting is an important branch of philosophy").

So back to essentially the monetary issue, and that claim explicitly Jorion and Voyer.

Voyer happen to think " Demonstration of non-money creation by commercial banks and stupidity of the saw "The funds are deposits" . So I will not repeat here the usual "authoritative arguments" used against (most often) or for this thesis, I'll just use this simple common-sense the reader, who will his own opinion.

heading back definitions of money and currency , that what these words represent, both conceptually and practically, for all of us: when it will be necessary for clarity, I will use a concrete example, that of the euro, to avoid ambiguity.

The currency - a term used by all Economists - (English money) is what is used to pay in a given community: the euro in Europe, the U.S. dollar. The term 'popular' to put money, alas, is "money", which leads to confusion semantic regrettable.

We reserve the term " money" to "cash" ("currency" in English): our Canadian friends of the movement "social credit" call "pocket money", those who speak "Franglais" also say "cash" ticket 100 euros is the money. A total of 100 euros , whatever its medium, electronic or paper, is the "currency .

There are different national currencies: the dollar, euro, yen, ruble, are all examples of "money", they are not "silver". A $ 10 bill is money, the sum of $ 10 is money.

Having acquired, at least for the present discussion, what is a "currency" for three things in reality.

1) is a means of payment, universal, accepted everywhere (at least within a certain community: Europe to the Euro, Russian ruble for)
2) is a standard of value, a unit of account (the prices of goods and services are displayed in euros in France - not sheep or kilos of salt)
3) is a store of value (you can keep notes under his mattress, and later use, keep a certain amount of euros on his bank account and use it later without "too much" to lose purchasing power: it all depends of course on the general evolution of prices of goods and services in the community concerned)

On point 1, "payment method" some believe that ticket euro is more effective than a euro bank account. It can pay its bills baker, and any merchant. You may refuse a check payable in euros or using your credit card.
But conversely, I'd rather have 1000 euros in my account to place an order on the internet or pay a deposit for my new real leather sofa. Moreover, above 1500 or 2000 euro, any transaction must use the money "non paper" currency short (either by transfer, either as sending a check or in the form of debit card a bank account).

So, no decisive advantage between cash and currency (banking), except, of course, if you have a certain attraction for the work 'black' and suitcases full of cash to carry in any tax haven.

On item 3, "store of value" may suggest that retain their tickets Devers by itself or under the mattress is more effective than keeping a sum greater or lesser extent, to the bank. If
bank run, you may not have time to collect your tickets, crash, your bank, if everyone wants to do the same. In fact everyone agrees, whether or anti-Jorion jorionaiste or-Jorion, to think that there are fewer tickets available as currency in circulation (I still have not figured out how Jorion, before this finding , could say that money "no money" did not exist without a philosophical mystery doubt).
So if you're interested in tickets, you will think this is a better "store of value" that your bank money: this reserve "tickets" will always be available.
Again, this can be discussed, because in case of bank runs "partial", you can always try to make a transfer to another bank, rather than get trampled at the doors of your agency by a cheering crowd.

But regardless, even if one can admit that the "Notes", the paper money is on this point - the store of value, "better money" that the "currency in general," currency "scriptural" and 100 000 in tickets, your home is preferable to 100 000 euros to a numbered account, somewhere, the question arises here how money "non-paper" is issued, how it "begins" how it "ends", in fact how money is created and how it is destroyed, and by whom .

Historically, the story is well known. The currency began as a currency "goods", and between 1700 and 1900, this commodity money was mainly for gold, at least in the West.

This gold was "stored" in bank vaults. Bankers were just "custodians" This gold guards safes. Their clients brought their gold, and received in return a certificate of deposit (it was a real submission, customers deposited something, unlike what is happening now in bank deposits which, in general, are not customers' deposit "money" hard currency ").

This certificate of deposit, or received, could be used in 2 ways.

The first way, of course, is whether the trustee sought to recover all or part of this gold.

The second way was to use the receipt as a ticket to bearer to purchase goods or services for hire. This receipt could then pass from hand to hand, the holder of such receipt (sometimes cons authenticated by a signature, or a series of cons-signatures) using it as currency (exchange), as payment.
The "store of value", it was the stock of gold.

We all know, more or less, the rest is history. Not content to get paid for the service of "security" of gold to their customers - which is quite normal, of course - the bankers, noting that they rarely came to claim their gold, began to emit Nor receipts, but loans. These loans were not secured on the gold they possessed (most bankers did not "own funds", or if it did, it was a small part of the stock of gold that they "kept") but the gold they had on deposit.

And instead of being limited to the beginning of this scam: lend other people's money, but without paying more than their stocks are not allowed (if they had one million euros gold, paying the same amount it there would have been two million in circulation, one million "100% or" corresponding to the received gold deposits of their customers, one million loans "Ex nihilo" based on wind, and a clear deception), they went much further
. Noting
"empirically" (the word scientist, scientist who wants to "empirically" or "pragmatic" .... is "statistically") less than 10% of "their" gold was claimed to be withdrawn and that the withdrawal movements were mostly offset by movements of deposit, bankers these "guards" went to emit 10 times - for the more timid - to 100-fold - for the most "audacious" - the value of the stock that they had in custody.

Hence, of course, recurrent banking panics, when the dispossession of gold trying to return for more than expected, their gold.

Well it is exactly the same today, gold had 'just' been replaced by paper money and bank loans have become the bank money, instead of little words written on a piece of paper by their banker, "bank-note"

If you look at the "bank capital," their "equity", European banks are required by law to possess 2% of the money that 'they lend. With cash reserves (money, paper stocks of euro banknotes) that banks are also more or less required to have, or can be obtained very quickly in the day, we arrive at a possible loan of about 7 to 8.

Holds specifically and concretely, with twenty billion euros of capital, and reserve tickets 150 billion euros, the European banking system can lend up to 1 trillion , these loans are 80% built on "trust", the word noble to say "wind", the "vacuum" of money created ex nihilo.

The facts speak for themselves. Over the past 20 years the ratio "Money" / "cash" or, more precisely M1 / "cash" in Europe has fluctuated between 4 and 9.4, to oscillate, since 2003, between 4.4 and 6.2. This ratio is currently 5.95. (M1 is the sum of accounts - wrongly called "deposits", while most of the time these deposits were created by loans, and not by an initial savings - and tickets, euro-notes, outstanding)

What do Jorion and his disciples, while not disputing that figure, they say simply that this ratio does not make sense, we should not compare the bank money and money (I dare not assume that they have also refused we examines the ratio between loans based on gold and gold itself there a century or two, the "sign" not "the thing")

So back to this issue of creation Money-destruction.

Taking into account the banking system as a whole (you can also see one of my previous posts), we can consider that this system - all commercial banks - has a certain amount of euro banknotes, tickets that were issued by the ECB, European Central Bank.

Until we pay in euro, whether in notes or coins (scriptural) - Checks, credit card, wire transfers or other - there is no problem, no "leakage" outside the system.

problems can come from three sources:
a) if for some reason or another, customers want the system removing more "liquid" (the equivalent of "more gold") that the banking system possesses.
b) if for some reason or another, the central bank requires a change in the ratios of banks, whether liquidity ratios or capital ratios.
c) whether the purchases made outside the euro area are more important than sales, and if the euro is considered a more attractive currency.

In these three cases, the European Central Bank would intervene. She will do for the common good?: This is another story.

Now, if we look at what happens inside the system, the story is a little complicated.

So far we have considered a cluster of banks, the banking system as a whole. Talk of euro in general had a meaning, and a ticket of 100 euros had a specific meaning, speaking of a count of 100 euros - that this account is at Societe Generale, the BNP, Credit Agricole that the Post Office or Banques Populaires also had a specific meaning.

But if we speak of competition between banks, this is no longer necessarily true. One euro BNP does the same as a euro CA, BP one euro, one euro Post.

The answer is ambiguous: it depends. If competition is "oligopolistic" and "stable", ie if each bank is satisfied with its market share, not trying to attract new customers, "leakage" between BBP euro, euros and CA euros to compensate for other "statistically".
The key word here is compensation: overall, checks, wire transfers that go to a banking group to others will be compensated by check, bank transfers and other transfers which come from other groups, and this will be true for each banking group. It is obvious, and there is no need, I think, to be an expert in accounting to understand. It is a game of musical chairs, but where there are as many chairs as people.

In case of "turbulence" bank, what are the biggest risk that "statistically" the least, unless the rumors are more specific groups: General and society could be attacked during the episode Kerviel. The banking system did not like too much turbulence, it is rare that they are trying to grow "in house" market share: they prefer to buy banks that grow at their expense. Otherwise, if banks want to increase their share of cake, if some people want more seats than they have initially, it can go bad, of course.

course, they may also try to acquire customers "liquid", for example those who have "real" savings. And hunting of Caisses d'Epargne customers and owners of Book A (Squirrel or La Poste) has enabled Crédit Agricole attempt to win customers providing them with a little more security.

Returning leakage "of money", we have seen that they could occur within the banking system. They can also occur between the commercial banking system and the central bank, if more tickets are suddenly needed. But historically, the ratio of "Money" / "liquidity" is very rarely changes abruptly, and the "panic" for lack of tickets has never happened in France since the 1930s or even earlier.

This bank money, which comes from banks, which circulates primarily between bank accounts, deposit accounts (called, wrongly, we have already said "deposits"), where is it? Banks, course.

This currency is issued in connection with loans, and is destroyed during reimbursements: this is why some call this currency a currency "credit" or "money -debt. "

How can one explain, then, that this money, especially when measured statistically by the M1 (bank money more cash in circulation) is growing faster than GDP, ie the measuring the aggregate production and consumption of wealth?

If repayments are lower borrowing is good for one simple reason, as highlighted by Louis Even and supporters of social credit in the mid-1940s: banks lend cons interest. can repay the principal, since money that banks created to serve it. But you can not pay the interest with money originally created .

Therefore new debt and / or destruction of wealth, to allow the money supply to grow faster than GDP. Borrowers, without new borrowing, will never, overall, statistically, repay all their loans. This is true for individuals is true for states.

course some individuals can pay, but by condemning other individuals to be driven to bankruptcy : in this case the relevant currency will actually be destroyed. Either the banks will use the guarantees that the borrower has deposited ruined for his loan. Thus, overall, banks always come out winners, as the system will work well.

And it is the same for the public debts. Less than coerce borrowers into bankruptcy, or obtain a moratorium on banks, public debt will never die.

It is amusing to see some good apostles, including P. Jorion and consort, the question of where this economy is from debt, then they deny the phenomenon that causes the creation of money through loans.

One last question, maybe. If money grows faster than the wealth produced, why the money-liquid itself - the banknotes in circulation - roughly follows the same curve, if one believes the ratio "M1/Argent. Currency "non-paper" is increasingly used (more than 95% of exchanges are otherwise than by the use of cash), less money and less.

The central bank is it simply "Follower" : it transmits the monetary base (notes and central bank money) to support the growth of debt, ie money (scriptural) bank, or is it vice versa?

I leave this question open. The reader to see.

last remark finally. Can we get out of this deadly system (for the economy in general and for the excluded, the humble, those without degrees in particular)?

I believe, and have identified two ways to do this, that I would resume in a future post, that of social credit of Louis Even and his successors, that of monetary reform described by Allais in his book "capital tax and monetary reform" and in subsequent articles.

Good reading, critical comments welcome.

Tender Thoughts Greetings Cards

Currency , realities and utopias

Mint, realities and utopias

playback of a video, very interesting, produced by the organization ** " theMoneyFix " prompted me to take the explanation of the "monetary system" both to try to stop the fantasies associated with them, and also, most importantly, to try to indicate some possible solutions so that the currency is more a means available to the economy an end in itself.

First, I'll fix the vocabulary used, before browsing the outline of the video above in commenting on key points.

I shall make some comments more personal.

vocabulary monetary
What the Anglo-Saxons call " money" will be translated as ... " money" (within the meaning of " currency, or whether to be more explicit and precise monetary aggregate M1).

The word " currency" will be translated as " cash" or "cash" or "paper money" (Other equivalent would be "cash", "fiat money", "liquidity") . The "paper money" is issued by the central bank in Europe by the ECB.

The "money" has, therefore, as proper subset, paper money . Some questioned, but we'll see why this is not debatable.

That tells us, or reminds us, this video, on the sociological aspect currency :

1) Facts and sociological phenomena.
The money seems to govern most of existences, that we have very little or a lot.
Few people really know what money is, and seem also not really worry about it. It's more uses of money, what can be done with, than it is of concern to most people

2) After noting that the Federal Reserve in America has been based 1913, a consortium of private banks and is neither "federal" or "reserve" the problem " social reality "of money is raised.

3) Two lines of inquiry are suggested: Why
money, which should be at the service of all, we manage it, at least in the U.S. by a private organization?

Would not it because there a link between the monetary system and the collective unconscious of society : with no doubt, subliminal, that it would change society in order to change monetary system - on this point, I call rather for the opposite?

The big "secret" or the mystery of money will then be revealed to us, after 14 minutes instructive because of the impressions from the "common man"

4) For this, we first recall the role of bankers time the "gold standard".
The first currency, or the first "paper money" was simply to received gold cons. Instead of wandering and pay with gold coins, gold was deposited to his bank in exchange for a receipt, and we paid with the receipt, which circulated so instead of gold, one currency jangling of the time.

5) As it was not very "profitable" for our bankers, they began to issue more paper money they had in their trunk .

We do not say is how it was possible (since these pieces of paper could not be delivered as received, since the new gold was not made by the same assumption). One can only assume that was the beginning of the currency debt or bank credit. A banker said his client B. I lend you $ 1000, or better, I'm worth $ 1000 paper: B, delighted, asked rarely to be seen whether that gold existed, or where that gold came from another client C, which have deposited their gold to the bank.

6) It is the beginning of "money creation" by banks . Banks issue more paper money they really have gold, or "received gold" or "deposits" of gold. This secrecy did not really have a , at least he appears periodically on each bank run, when people want to "touch" their gold - supposed to be sufficient - instead of simply using only as payment means the "piece of paper" issued by a particular bank.

7) What follows in italics is a personal comment:
The only "secret", perhaps, is that the same applies now to the "paper money" vs.. "money well."

Let me explain: When only the
golden stock gave rise to receipts issued by the bank, received the "circulating" consistent with an initial saving (gold) that was used for various exchanges: at one point there were so many pieces of paper and deposits .

When the number of pieces of paper began to exceed the number of receipts - that is to say, the real gold, it only means that saving is insufficient to meet the needs of trade.
This is neither good nor bad, it's like that. The pieces of paper "circulating" outnumbered the "received".
This is not necessarily the "wind" as the pieces of paper flowing correspond to real wealth, a triptych production-consumption- additional investment.

Only if this triptych is gone we may wonder what all these pieces of paper. If you prefer a stock of gold - still - that can be bought with pieces of paper flowing - because we no longer believe that you can buy with these bits of paper - that is when the bank run, the cash crunch is not far.

8) Thus, when the stock of gold has been replaced by the stock of paper money (banknotes), and when the "moving bits of paper" were replaced by " money "- simple inscriptions on the books of accounts of banks, nothing has really changed.
Prospectors and depositors of gold have been replaced by the Central Bank the exclusive right to "create ticket".
The "pieces of paper" issued by banks ... have been replaced by bank money issued by banks ....
But the principle was and remains the same: banquent create additional payment paying more than they have in deposits "credits are deposits, even it is necessary that there be some initial deposits to extend credit - more important.

9) But why banks carry them this: when they give more loans they have on deposit, whether gold or paper money (dollars or euros), they take the risk of be "liquidity" - and hence be "liquidated", put into bankruptcy. They make a bet, and a finding .
The bet made, or risk taken: it can not provide enough liquidity (gold, a century ago, or tickets today) they appear weak, very weak, for interest they get for this money creation.

One example to illustrate this.
Consider a bank that has 10 billion cash, $ 8 billion of customer deposits and $ 2 billion in equity. With ratios of "prudential" classic, it could lend up to $ 100 billion. If it lends to 5% (which is not very high) it will earn in a year 5 billion (2 billion of capital: cost, 250%). His
risk: that his clients want to withdraw more than 8 billion or more than 10 billion in cash: low risk in a "normal" but may nonetheless.

To hedge, she knows - better than the time of the gold standard - it can rely on three resources: its fellow-on the interbank market, other financial institutions-the-bank money market Central, then the only way of "creating" paper money, the "real cash". Currently
(Natixis report of January 2010), European commercial banks can obtain the monetary base (currency paper or central bank money) to 1.5%, to lend at 4% or 5 - (4% for the state French, although he is allowing banks that loan to 1.5% ....)

The risk is not very important, much less so than the time of the stocks of gold: not easy find a new gold mine in the event of bank runs ...

To return to the video itself, the authors insist on a very sound idea, but not always well understood, which is that the currency is more of an idea, an agreement, an "agreement" (ie a convention) a reality. The monetary system is an information system in which some people recognize owe money to others, these IOUs can take several media, including the physical, tangible, becomes less and less used (3 to 5% of trade), whereas Information itself is increasingly dematerialized (how to use essentially the credit card, check and bank transfer between accounts), money "intangible" is used in more than 95% of cases .

loans underlying the issuance of currency virtualized, this book money, in concrete terms simply write in "bank accounts", sight deposits (it would be better to call deposit accounts because there was no advance deposit)

10) So the best interest including banks, which is the basis of bank loans, these loans are justified or not, "I am interested in your money" say the banks. In fact it would rather " loans that I grant you I'm interested " should say that each bank.

11) It is from this "interest" that the authors of the video broadcast two theses, which are based on reality, but whose conclusions are partly questionable. Since
as principal of the debts, loans and is expected to be repaid a loan of 10 billion will not create permanent 10 billion, a gross balance of $ 10 billion should not be confused with a net balance of 10 billion. Should we, in contrast, conclude that there is no money creation "scriptural" durable, like keeps (wrongly) a small current heterodox? The authors of the video does not directly address this point - which is odd, by developing two theses following:

The interest is not created during the credits - which is true - will not be reimbursed from the loan - which is still true, and the corresponding resources will be found elsewhere - which is still true. They conclude that the interest can not be paid until other resources - which is still true - and that these resources are necessarily in debt, which is partly questionable.
If there was growth, it is also conceivable that the Central Bank was able to accompany this growth of an issue of additional paper money, or that the interest paid to banks has been used to these banks - which have the right to spend their own money (= "money"), even if they prefer to spend the their clients, created ex nihilo "- to buy additional production allowed for growth.

Moreover, these authors argue that if every person indebted repaying its debts, the monetary system would collapse , as there would be more money.

Again, it is "almost" true, it all depends on interest rates and liquidity ratio. If we return to our example, with 10 billion money (= banknotes), an interest rate of 5%, and 100 billion in loans must repay 105 billion: there will be more debt, and it will remain 5 billion of "liquidity" of fiat money.
Their thesis is "theoretically" wrong - at any given time, depending on the accumulation of interest already made - but "almost real", interest eventually accumulate more than reason, and this, more faster than the interest rate exceeds the growth rate of the economy. Indeed, in practice, the average interest rate is surely higher than the one I mentioned, and it seems difficult that everyone can repay all its debt without jeopardizing the general economic equilibrium.
In another form, the oldest writing in the years since 1940, Louis Even, we'll see about Social Credit, said in a manner equivalent to the body (when not controlled) Bankers:
" The banker made the capital, just capital. Nobody's interest, since nobody else is making money. But the bankers demand both principal and interest. Such a system can take only with a continuous stream and increasing borrowing. Hence a system of debts and consolidation of power dominating the bank . "

So much interest is the major cause of monetary crises : should however addressing the role of creation monetary banks? is a possible solution for bringing real money - as way - serving economic prosperity-the end . We'll talk later.

I would argue more readily For my part, the proposal Next: delete (or remove) the debts of state and excluded : it would put several banks into bankruptcy, but it probably would rely.

We come now to the tracks more or less realistic, even utopian, proposed by the authors of the video: I will mention three, and adding two more of my own.

The proposed five tracks all have the same goal: allow the socio-economic system in which we live does not remain forever hostage to a flawed monetary system , and prevent the potential development wealth, material or not, either blocked or directed by the iron grip of a currency is not primarily benefiting only the wealthiest at the expense of poorer or less fortunate.

These five tracks are: complementary currency "conventional" mutual credit, barter, social credit and currency melting.

Mint complementary "classical" and barter share a common vision: it is not to replace the currency "normal", that operated by bankers, but to supplement it. The

complementary currency in the video is based on a practical experience (that of Ithaca in upstate New York) and is issued hourly equivalent, which would not have repudiated Karl Marx and his labor-value, time of work is the standard measurement of all things. This idea is similar to that developed by the proponents of the French écosociétalisme, one of the best known representatives is Andre-Jacques Holbecq. I think

medium for this type of money that, in my opinion, can not be meaningful at the level of a community rather swaging not exceeding a few hundred individuals, this However, a good approach to currency "complementary."
It may also have a sociological and psychological impact not negligible, re-socializing of excluded or vulnerable people by the "system". Another problem highlighted by one of the authors of the video is that currency "zone" is a currency, and its amount is defined. It may therefore be insufficient money, money stock (cons this argument seems questionable, however, because the number of hours in a day is limited, too)

The barter ("bartering") Again, do not want to replace the currency classic, but complement it. We will exchange services products, through a grant, a news magazine, possibly web sites, the principle being to fight against the unused resources and unmet needs: printing does not turn that 50% of its possibilities, vintage cars sleeping in a garage, restaurant half empty, etc..
Again, at a local association or community not too large, this can lead to socio-psychological, but I do not see what barter industrialized as the track for the future.

Runway mutual credit seems richer, because it leaves decidedly off the beaten path. It is based on the fact that there is no system in this "stock" of money: the overall balance of the "credit mutuel" is necessarily zero.
At one point, there are accounts receivable and payable, but the debit-credit balance is necessarily zero. Everyone starts his day, or year with a zero balance, and according to its consumption and its "production" (of goods or services) is found at a given time debit or credit. The idea seems very interesting, and its use "community "Entirely conceivable. But its widespread use remains a mystery to me, despite all the books and articles or pointers I traveled on the issue. (See also )

In a world where all individuals are caring and generous, there would be no problem. In the real world, the issue of control seems fundamental.

The last two tracks are not included in the video.

One is the Social Credit Louis Even (http://www.michaeljournal.org/vraics1.htm) context in which production and consumption directly socially recognized and (therefore?) monetized. The currency is issued at the time of production, and destroyed at the time of consumption. Prices are expressed in what one wants, "euros normal" or "hours", depending on the socio-economic development. Banks are removed, at least in their role as shapers of debt (and interest rates), they can maintain their role as an accountant. For me, it "LA" runway digging, because it can be generalized and / or imposed on a department, a region or an entire country: it is not a utopian community restricted to a community "fun." It may be a utopia, but if it materializes, it does not depend on the kindness or good nature of individuals who constitute the society concerned. The social credit
talking about what should be done , what could be done: " Wealth is the thing, the money is the sign. The sign should go after the thing " (Louis Even , which also mentions the social doctrine of the Church and Pope Pius XI: 'Those who control money and credit have become masters of our lives ... without their permission no one can breathe')

Another track finally , complementary currency or substitute currency, I do know that of the slush money S. Gesell. It is an anti-hoarding currency, a currency biodegradable, a currency that is forced to circulate. The fact that she automatically loses, officially, a little of its value each month (eg 1% per quarter) is supposed to allow, even require, its traffic problems.

If the possessor of money is an incentive to spend it as soon as he receives it, separating the two parts of the transaction, selling a good or service against receipt of money, and spend money buying a cons good or service should make this shorter period, or almost instantaneous, and thus boost sales, so the production: less temptation to build a precaution, a mattress tickets.
The "store of value " portrayed by some as the absolute evil no longer exist. Again, this is probably an idea to dig, because it does not particularly appeal to good feelings, even if such feelings are very desirable course.

Among other tracks, some suggest no change in the 'small' detail near prevent money creation by private loans private banks, an expression of the slogan "100% money . I do not think if we are pleased with this, but ...

When we talk about currency reform, it is difficult not to mention the proposals Allais, specifically the focus of its monetary reform ( the other point would be a tax reform, we will not discuss here): Maurice Allais

has proposed (see C. Gomez ) in many studies to separate the functions (deposits and credits) by making exercise by separate entities. We have thus:

- Commercial banks , which would take care of that cash management customers, by covering 100% of paper money (issued by the central bank )***.
- loans banks that receive deposits / savings and loans at terms slightly shorter borrowers.

Comments and criticism welcome, BL



** see commentary 'anonymous' ***
point reminds AJH in a comment