Bill, I am not sure to whom this posting is directed. ------------------------
It was in reply to Joe. -- I have never said that Douglas stated that interest or bank financing should be abolished. My posting the Douglas quotes was to show that Douglas recognised: (a) That the deficiency in purchasing power (B) was being filled by further loans (debt), ------------------------ True -- (b) That banks did create money out of nothing ------------------------ Which means merely that it is a matter of contract rather than for example mining and smelting something tangible from the ground and coining it. -- (c) The when that new money is created the banks claim it as their own, ------------------------ A matter of philosophy that we seek to change. -- (d) That when it is lent it creates a debt ------------------------ >From the borrower to the banker. It also creates a debt from the banker to the depositor whomever that might ultimately be. -- (e) That the only way interest can be repaid to the bank is for it to come from the same source - the banking system, which can only be through further debt. ------------------------ It's also the only way that principal can be repaid. The money received by the recipient of the money borrowed from the banker is already on its way back to the bank, so is not available to repay the principal of the borrower without further borrowing by others in the economy. The false inference is that money must be borrowed to pay interest and not other purposes--such as continuing operations, so that debt compounds because of interest. Debt does compound but it compounds because of labor displacement that can be accommodated through consciously applied accounting adjustment--not possible now because of the lack of a national capital or credit account. Interest is merely the allocation of profit between banks and other firms when looking at the economy as a whole. Profit is not a tangible thing but the function of the rules of accounting. It is meaningful--like the score at a football game is meaningful--but not a tangible thing, as would be the case if M -> C -> M'; profit = M' - M. The fact is that in terms of cash flow (which are rates), M is normally greater than M', not less than M', yet firms in the aggregate book profit continuously--which is exactly opposite to what seems must be intuitively true. It comes down to how credit is counted through time. The process is poorly understood by economists and accountants both. I am convinced that Douglas grasped it almost completely. ____________________________________________________________ Get advanced SPAM filtering on Webmail or POP Mail ... Get Lycos Mail! http://login.mail.lycos.com/r/referral?aid=27005 ==^================================================================ This email was sent to: [EMAIL PROTECTED] EASY UNSUBSCRIBE click here: http://topica.com/u/?a84IaC.bcVIgP.YXJjaGl2 Or send an email to: [EMAIL PROTECTED] TOPICA - Start your own email discussion group. FREE! http://www.topica.com/partner/tag02/create/index2.html ==^================================================================
