[P2P-F] An update on BIBO, financial stability standards, and the debt-virus hypothesis

[Michel Bauwens]

Dear Sepp,

because the discussion is largely technical, this is all I can do, but
perhaps you can add an extra comment?

also, if you are in contact with Marc, please give him a chance to say
something about the evolution of the bibo project since december 2009,

Michel

<http://blog.p2pfoundation.net/understanding-the-logic-of-intervallic-periods-i-e-periods-with-riots-not-revolutions/2011/02/08>


<http://blog.p2pfoundation.net/?p=13869>
[image: photo of Michel Bauwens]
Michel Bauwens
16th February 2011

In December 2009, Sepp Hasslberger introduced to
us<ttp://blog.p2pfoundation.net/bibo-a-standard-for-stable-currencies/2009/12/03>Bibo,
a proposed standard for stable currencies, that would replace the
current inherently unstable banking money system.

This article has become our most comment rich article, in particular through
a recurring debate between one of the Bibo co-authors Marc, and Ardeshir
Mehta.

Ardeshir has written an article that challenges one of the main points of
monetary reformers, i.e. that the current system leads to the infinite
creation of debt through compound interest.

You can find it
here<http://homepage.mac.com/ardeshir/DebunkingTheDebt-VirusHypothesis.html>
.

The context:

*“Currently, most if not all money is loaned into existence by banks, and is
thus based on interest-bearing debt. There is no question that neither
interest nor debt-based money are good for society, and I have written
denouncing both debt and interest elsewhere. However, there is a fairly
common thesis, based on the fact that money is loaned into existence as
interest-bearing debt, that if new loans are not continually being issued in
ever-increasing amounts, enough money will not be created to pay the
interest on existing loans; and as a result, at least some those loans will
be defaulted upon, resulting in inevitable foreclosures. “*


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