From: "ideasinc@ee.net" <ideasinc@ee.net>
To: P2P Foundation mailing list <p2p-foundation@lists.ourproject.org>
Sent: Wednesday, 21 September 2011, 15:20
Subject: Re: [P2P-F] Why we can afford Climate Change...

Robert et al,
    while Ann Pettifor is generally correct about how central banking works, 
she is wrong or omits a several important details. The privatized version 
of central banking under a fiat sovereign currency has only sort of served 
our collective and common needs and it is actually not very functional at 
all. As she describes it we have a "credit" based system. The use of the 
word "credit" is often used to mask the reality that "credit" is debt by 
another name.

    She also omits entirely describing the major difference between credit 
(debt) based money issued by a privatized banking system which issues 
credit as compared to the effects of currency issued debt-free by a 
sovereign government in the interest of sustaining and developing 
societal/sovereign infra-structure. Under the privatized issuance of debt 
based currency the privatized monetary system accumulates both the 
interest attached to currency as a credit and it makes back the entire 
principle as well. Adding together the compounded interest and the 
principle of the debt (aka credit). This makes the related debt to be 
HUGE!!! To provide this free rent on the franchise granted to privatized 
central banking, other than related overhead costs of operating a private 
bank and central banking system, those who sign onto the credit/debt 
issuance of currency units have to go out an essentially strip the economy 
and the commons of resources which by the fractional reserve and 
leveraging ends up being many times the original debt/credit. When a local 
or central government uses bonds to credit that currency it is acquiring 
debt to private investors including the banking issues this the related 
debt/credit. This result is very, very different under a sovereign, fiat, 
asset based currency process.

    She is quite right about the feeding credits into the demand side of the 
economic ledger IS how saving are established for the general population. 
Having the sovereign government go into credit/debt to develop 
infra-structure needs, is poor strategy compared to currency issued on a 
debt free basis. Credit issued as loans either to the central sovereign 
government or to corporations and private individuals (think "mortgages" 
as a contractual agreement of debt/credit. If currency is put into 
circulation on a debt-free basis by the sovereign government, the the 
private investors, including banks will not acquire the huge returns 
achieved for private interests by way of the debt basis of the issuance of 
currency. She does not distinguish her "supply-side" aka consumer demand 
side of the economy and supply side to the benefit of the privatized 
banking systems. This will make her presentation seems very much like 
"supply-side" economics, in service to plutocracy. This lack of 
distinction is problematic in the details of how the issuance of currency 
can serve the interests of the commons in many ways.
   
    Trusting banks to invest in the de-carbonization of our industrial 
cultures, under the private credit/debt basis of issuance, will cause 
those investments to go where the return on that investment will be 
highest. If a high private return on the "investment" is somehow 
guaranteed by the government, then the debt load will be higher, compared 
to what it would be under a process where the sovereign government acts as 
the primary steward of the commons and the currency credits are issued 
debt free.

    It is this sort of poorly informed jumble packaged along with very 
attractive objectives, ends up adding to the net public confusion of how 
monetary systems and a functional approach to fiscal policy could operate 
in the interests of the commons and toward sustainability.

    Ask questions here, if you don't understand some of these details. I will 
be happy to respond. The bottom line issue is that the commons and 
sustainability will be vastly better served by a fiat, asset based(aka 
debt/credit free) currency issued by a sovereign government. At least she 
has some content that points in the right direction, but then she also has 
significant content that ends being poorly informed and even likely to 
have a major net negative impact. There also seems to be no implied or 
actual analysis of how the globalized,centralized, privatized banking 
conventions have produced the current melt down. I half expected her to 
also advocate for further deregulation of the privatized currency commons.

as we go, Tadit Anderson

   




Thank you Taditt. I do not think Ann Pettifor is as well informed as you but her basic point is very important. Moreover, I have not fully read your comments properly...maybe later when I have the time. RS


On Wed, 21 Sep 2011 07:27:05 -0400, robert searle <dharao4@yahoo.co.uk> 
wrote:

>  People are at long last waking up....to a more intelligent approach to 
> financing......There is hope yet for humanity...!!
>  http://www.youtube.com/watch?v=UMEsWxrnAY4
>  RS.

_______________________________________________
P2P Foundation - Mailing list
http://www.p2pfoundation.net
https://lists.ourproject.org/cgi-bin/mailman/listinfo/p2p-foundation