The fact that something might seem to come first does
not mean that something is the cause of what may seem
to come next.
Eliminate the egg there is no chicken.
Eliminate the chicken there is no egg.
I'll skip over some parts that we'll fill in later.
Both the chicken and the egg are 'wealth', and regardless of which came first, initially a product of Creation's 'natural law'. 'Debt' was created by man, and is not 'wealth'.
There is an observable flux of loans from the
financial sector, and the observable reflux from the
rest of the economy in amortization of those loans.
This flux and reflux can be graphed on a chart
against time. The respective flux and reflux curves
remain identical regardless of the rate of interest--
which is simply a matter of bookkeeping. What
changes is the bookkeeping allocation of the reflux.
At a zero percent rate of interest all the reflux is
credited to principal. At any positive rate of
interest a defined and agreed portion of the reflux
is credited to interest.
It means simply that profit is shared between
entrepreneur and banker; what the entrepreneur pays
the banker is in payment for financial services
rendered.
That the banker has mobilized the credit and should be fairly recompensed for doing so is something with which I have no problem. But I think 'interest', while it may be synonomous with 'profit' in a certain sense of 'bank as business', is still more than just another profit as regards any other business. My profit is dependent on 'result'. The 'result' of my products selling for more than their cost. Whether the lumber I produce sells 'hot off the saw', or hangs around the yard for six months, or longer, there is no profit until it sells. Contrast that with the bank's profit through interest. It is based on time, and continues to accrue through time even if the 'results' generated by people like me that allow its actual payment fail to materialize. Does my profit accrue the same way, just because I've produced something? Not unless I keep books something like Enron did it doesn't!
Between consumer and banker it means that the
consumer shares with the banker the appreciation in
his wealth that through his financial services the
banker helped create.
It is part of the way we got to where we are rather
than being confined to the jungle hanging from trees.
Which does not obviate the fact that banking is a
monopoly that must be controlled.
The inclusion of time based interest payable regardless of the actual circumstances of the borrower trends towards a monopoly in all those businesses that draw upon it
Joe
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