What is money? Where does our money come from?

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Old Nov 6, 2011, 4:48pm   #46
 
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Re: What is money? Where does our money come from?

what happens if you go to the BoE with a note and ask them to keep their promise to pay you on your demand the sum of ten pounds?
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Old Nov 6, 2011, 10:06pm   #47
 
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Re: What is money? Where does our money come from?

darktone started this thread
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I hope house prices stagnate for a few years to allow youngsters to catch up earnings wise to return to 3 times salary for mortgage.....................some hope I know
I think in real terms house prices are going down but are being masked by inflation atm. Im with you on the wage front, int gonna change imo whilst the pr machine is pumping austerity!

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Maybe the man was Governor of the Bank of England and had just printed the note..........
Nah, if he was hed a found a way of working some interest into that deal!

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We laughed at the Irani idea of lending to earn interest as being against Allah. I, for one, am not laughing so much now although, obviously, some middle ground has to be established as to what interest should be fair.
Im not totally against interest but imo it should be relative to risk taken. In reguard to money creation i think its totally wrong.

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what happens if you go to the BoE with a note and ask them to keep their promise to pay you on your demand the sum of ten pounds?
Lol, thats a good one! Ill try it and see next time im up town . As i currently understand it, a banknote can best be described as a physical claim on numbers inside a computer system.
Always gets a reaction when you point out that little line of text on a note.
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Old Nov 6, 2011, 10:17pm   #48
 
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Re: What is money? Where does our money come from?

darktone started this thread I voted for him, with luck they didnt notice the UK Ip
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Old Nov 10, 2011, 4:32pm   #49
 
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Re: What is money? Where does our money come from?

Most money now a days comes from decimals and zeros put into accts from thin air (thanks to dysfunctional central banking) - this will not end well!

Gold and Silver still makes sense to the long side longer term.
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Old Nov 11, 2011, 11:19am   #50
 
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Re: What is money? Where does our money come from?

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Originally Posted by LivestreamFX View Post
Most money now a days comes from decimals and zeros put into accts from thin air (thanks to dysfunctional central banking) - this will not end well!

Gold and Silver still makes sense to the long side longer term.
Maybe this would be closer to the mark.

"Almost all money now a days comes from numbers typed into accts (loaned at interest) from thin air (thanks to greedy bankers who count on the public being 99% ignorant of what it is they actually do) - this will not end well for the majority!

Gold and Silver still makes sense to the long side longer term, as well as pretty much anything else that isnt 'fiat money'."

Henry ford put it well i think
*It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning!*
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Last edited by darktone; Nov 11, 2011 at 11:30am.
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Old Nov 12, 2011, 7:13pm   #51
 
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Re: What is money? Where does our money come from?

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In this example id say that everyone is lending apart from the guy with the printing press who is creating credit/money.As I currently understand it thats not how our current monetary system works, the system we have is two stage. Central banks create the initial (base money), private commercial banks expand this money (create broad money).
Yes, but the amount of broad money that can be created is already determined by the Central Bank. That's the whole point I am trying to convey.
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Im always willing to be proved wrong. If we take the BoE sheet.
http://www.bankofengland.co.uk/publi...1/111102cs.pdf
It shows a total balance of near 261billion. The government figure for our National debt is around 980billion atm (this doesnt include the bank bailouts which takes it well over 2 trillion)
Could you tell me where the other money came from to back this debt?
What do you mean? There's a whole lot of people who have the ability to lend to the UK government, including people outside of the UK.
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I have my own view for sure, id argue that ive added a little more to this thread than just 'bunch of funny videos' and opinions of others.
Videos are great for folks new to the subject imo and are far more engaging than reading page after page of text. I also dont see the the harm of backing my view with reference to other material.
But thats just me.
I am not suggesting you didn't add anything to this thread. I am just saying that if we're to have a discussion where someone makes a specific point to which another can respond, it's impossible to do it with videos and references to what other people say.

Finally, I have read the proposal and I am afraid that it's fundamentally flawed. I could explain in detail, if you like.
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Old Nov 13, 2011, 11:18am   #52
 
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Re: What is money? Where does our money come from?

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Yes, but the amount of broad money that can be created is already determined by the Central Bank. That's the whole point I am trying to convey.
In theory i agree with that view. The US system (in theory) puts a ceiling on bank credit creation at around 9x. The UK / Europe has no clearly defined ceiling (that i can see) but controlled by 'stress testing' (i dont really know enough to comment on that). The banking crisis has shown that banks dont stick to these rules! To my mind this severely limits the CBs power over bank created credit / money supply.
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What do you mean? There's a whole lot of people who have the ability to lend to the UK government, including people outside of the UK.
I understand that but only around 35% of UK debt is held overseas. So where does the money come from to buy the other 65%?.
You previously said.
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Well, how about if you borrow the 20 from another friend and you now "have it" to lend. Does that qualify as credit creation or lending? 'Cause that's actually what happens in the modern economy. The money that the commerical banks "lend" doesn't actually get created out of thin air. It's, effectively, lent to them by the central bank and show up on the CB's balance sheet. This way the central bank controls (or tries to, at any rate) the total amount of "wide money" in the system.
I dont know, i sort of sounds like youre presenting two views which i find a bit confusing. To my mind, regardless of control, base and broad money are both created out of thin air. Maybe our views are closer than i see and its just a wires crossed thing.
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Finally, I have read the proposal and I am afraid that it's fundamentally flawed. I could explain in detail, if you like.
Certainly mate, all i ask is you keep it as layman like as poss.
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Old Nov 18, 2011, 1:29pm   #53
 
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Re: What is money? Where does our money come from?

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Finally, I have read the proposal and I am afraid that it's fundamentally flawed. I could explain in detail, if you like.
Any update on that?
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Old Nov 18, 2011, 10:09pm   #54
 
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Re: What is money? Where does our money come from?

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Any update on that?
Sorry, been snowed... Will come back.
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Old Nov 22, 2011, 8:12am   #55
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Re: What is money? Where does our money come from?

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Originally Posted by new_trader View Post
There are excellent articles on this site and a free e-book which explains money.

Atlas Sound Money Project

I think what donaldduke should be saying is that fiat money is debt because it has no intrinsic value, it is nothing but a promissory note from a government.
Great post nice articles!!!!!!!!!!!
Thanks
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Old Nov 22, 2011, 6:09pm   #56
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Re: What is money? Where does our money come from?

from my secret swiss bank acount:P
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Old Nov 22, 2011, 9:26pm   #57
 
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Re: What is money? Where does our money come from?

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Originally Posted by chrisbliss View Post
from my secret swiss bank acount:P
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Old Nov 22, 2011, 9:28pm   #58
 
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Re: What is money? Where does our money come from?

darktone started this thread Clearly not a real banker judging by the fit of his shirt. For some reason though this clips disturbes me some.

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Old Dec 5, 2011, 12:23pm   #59
 
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Re: What is money? Where does our money come from?

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Originally Posted by Martinghoul View Post
Sorry, been snowed... Will come back.
Bump bump, any update?
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Old Dec 5, 2011, 12:37pm   #60
 
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Re: What is money? Where does our money come from?

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Bump bump, any update?
Yes, sorry... I have been procrastinating. It's just a bit more serious than the usual forum stuff, so takes a bit more resolve for me to gird my loins and get down to business.
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