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Ellen Brown’s Public Banking

by on February 2, 2012
Public Banking

Ellen Brown is famous for her brilliant book ‘Web of Debt’. But she has not stopped there. Her Public Banking initiative is a direct assault on the Money Power’s control of the money supply. Her approach is fully in the Populist spirit and although it does not solve all problems, it is eminently practical and ready for immediate implementation.

The idea couldn’t be more simple: American States and Counties can open banks for themselves, capitalize them with taxpayer money and finance both the State and businesses with interest free (or low interest rate) credit. This saves them massive amounts of interest. It also secures both Government and the Commonwealth of continued financing, making them independent from unstable and often unwilling international financial markets. The little interest that is raked in by Public Banks is used to finance the bank’s operations and thus it is spent directly back into the community. In this way there is no drain of purchasing power for the community, which is a major problem in our current system.

Clearly, society’s independence from punitive monopoly interest rates by the International (Central) Banking Cartel is a great boon to society.

Credit is the modern way of creating money. Interest free credit is superior to debt free money in many respects. It is easier to take out of circulation, because the debt will be payed off. Credit can be given out several times, debt free money just keeps on circulating. A flexible money supply is in many ways attractive.

The key point to understand is, that the problem is not debt, it’s interest.

So Public Banking addresses both interest slavery and lack of access to capital. To boot, it decentralizes power from tightly controlled international financial power to local government, which is much closer to the population.

Another major advantage is that its main points are easy to communicate because they fully fit within existing paradigms. It can be immediately implemented by any State, which is especially important in this time of crisis.

Of course there are limitations too. But that is only natural and unavoidable considering the vast scope of such a thing as a monetary system.

Public Banking does not address the insanity of Fractional Reserve Banking. It does solve the Interest issue associated with it and that is of course by far the most important thing. But FRB is a very inefficient, expensive, unstable and fundamentally unsound way of creating credit. Eventually it will have to go.

Another issue is that there is a risk that Governments would abuse easily available credit, creating inflationary pressures. It must be said though, that an interest bearing money supply like we have today is inherently inflationary, because not only the principal, but also the interest to payed must be created. Otherwise people would have to go bust, because there is not enough money to pay off all the debt + the interest.

This is a key reason that our monetary system is so unstable: because the debt must grow eternally, the interest payed over it must also become more and more. This is why we must have economic growth, or face declining income. But it is easy to see it is unsustainable: the exponential growth can go only so far before the numbers become astronomical.

These pressures would not be a part of Public Banking so risk of inflation is limited.

All in all Public Banking is an amazingly powerful concept. It clearly decentralizes financial power to local and regional communities. It eats away at the horrible interest drain to the Plutocracy. It prevents deflation and the turmoil associated with that criminal enterprise.

It is available now to communities everywhere in the United States and all it needs is the support of the people to implement this wonderful scheme.

More information on the Public Banking Institute

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27 Comments
  1. REN permalink

    Hello mrmgauvin,

    Sorry I have to keep adding new threads as wordpress seems to truncate after about three subordinate entries. Anthony probably would have fixed this already if it was possible.

    I’ll try and keep my posts relational to PBI, especially with regards to double entry accounting. PBI is the main topic, so it makes for a good comparison and contrast..

    In BIBO, A member inputs an asset/wealth to be evaluated. This transaction is like a math function machine, where wealth is input to the machine; wealth is then reduced to a price, and said price as output is marked on positive side of ledger. This reduction to price during evaluation phase is critical, especially such that @ (currency) values remain bounded as a constant i.e. 1/10 of unskilled labor hour. Where the negative numbers as output from the evaluation function machine go are not clear to me. Are negative numbers also owned by the same member who provided the asset for evaluation?

    I’m taking poetic license since mechanics of BIBO transaction are not clear to me. Using double entry theory such as used by PBI, asset side of ledger is marked with positive numbers, and liability side of ledger is simultaneously marked with negative numbers. With BIBO the numbers are bounded where principle asset (+) = liability debt (-). This is critical to bounding the system, as negative numbers do not have usury embedded. I will make an assumption then: Provider of wealth (that person who is submitting their asset for evaluation) is both the receiver of positive @ currency and equal offsetting negative numbers. Asset/wealth provider then has positive @’s available to debit and spend. How positive @’s leave member’s account and how they return to negative column is unclear. Positive @’s may be debited, spent, pool, and return to ledger as loan pay down – similar to that of double entry bank money?

    Using double entry bank money (BM) theory, an unbounded asset would be attached to the positive side of ledger. Asset is unbounded because said asset is evaluated by a market, and markets can be pushed, such as in asset inflation periods (bubbles). Evaluation of assets in a BM scheme is based on money volume currently in marketplace; hence money as a unit is fungible (in this scheme). At the same time positive column is marked, a negative number liability side is also marked. The liability side is Principle + Interest. The borrower is responsible for paying off the loan in time increments. Positive bank money leaves the ledger and spends into money supply; said money supply may be thought of as a pool. Bank money, after spending, pools into “money supply” where everybody can use it – however BM has a time stamp on it, such that BM wants to drain to ledger during loan pay down increments. Positive BM meets negative liability, causing BM to vanish from existence. Of course negative “debt” exceeded the principle, causing our well known problem of compounding usury, especially as debt seed is rolled over into principle of new loans, and embeds itself in the cost of goods and services. PBI theorists are considering Fees, so there is some convergence to BIBO, although it is still unbounded as evaluation is related to markets.

    Are negative numbers also owned by the same member who provided the wealth asset? Do @’s flow and pool, and then vector back to the ledger in time increments?

  2. REN permalink

    Hello mrmgauvin,

    I started new thread to keep it from truncating.

    I agree with most of what BIBO stands for, and I applaud the effort. It is all honest work. The point I’m trying to make, and you haven’t yet turned your laser focus to it, is that all money types settle credit/debt contracts. A good can settle the contract, where the good represents labor, ideas, or basically anything we may trade. Or, a unit can be legally devised to settle the contract. Monetary reformers are focused on the unit, but sometimes forget it must both operate within a larger social context, and also be acceptable to an individual.

    To prove the veracity of instant credit/debt contracts, go up to one of your friends, and ask him, “Please hand me your mobile phone?” After you have possession of his phone, ask him these questions, “How are you feeling right now?” “What would you say if I dropped your phone?” “Would you feel better if we had negotiated standards of behavior before I took possession of your phone?” During this episode remind yourself that you are debtor, and your friend instantly became creditor. Please do this, because the emotional impact on yourself and your friend will drive the point home more viscerally than logic. Watch their face as they wrestle with the dilemma you’ve forced upon them.

    A credit/debt contract was formed, and this is unspoken, and a function of our evolutionary programming. We humans are conditioned to have trusting tribal relationships, where we loan our credit and exchange goods with each other. We automatically form creditor/debtor relationships, and we then want some sort of legal recourse when credit/debt contracts are abrogated.

    What BIBO is doing, and like all just money systems, is asking for an honest unit to settle the debt/credit contract. BIBO wants to be the distilled essence or atom, and this atom follows the guidance of its system. BIBO and other money types take on the characteristics of the system they operate within. Since we form contracts both unspoken, and legally written down, the “atomic unit” must be a legal entity. It can be no other way. All money is fiat, and comes into being with the law, BIBO included. All money types are used to settle debt/credit contracts; these contracts are a derivation of our evolutionary programming. Bounding credit makes it more useful, but it is still credit. Credit can pop into being, travel and then extinguish, hence it follows a straight line; but it still a tool that human’s use to settle credit/debt contracts.

    Ask your mobile phone partner, would you accept money for your cell phone good now in my possession? If they answer yes, then money must stand in for a good. BIBO credit “money” travels in a straight line through the contract to extinguish it. Demurrage money rotates in a circle satisfying contracts in endless loops (until drained with taxes). In all cases, money must travel through credit/debt contract to extinguish said contract. This is my mathematical/legal axiom.

    Comet theory as a thought experiment is used to test a system and conclude an output. How does BIBO behave when humans retreat after the comet hits town center? Credit systems and money systems break down, and need external counter-cycle spending. A comprehensive legal/money control system would allow low level “balanced” (BIBO?) functions to operate autonomously. But a higher function control knob needs to available for the comet dilemma. Bounding and balancing is only necessary for autonomous functions, but any good control system must have inputs to null outside variation e.g. “comet” variation.

    PBI public bank system has knobs to deal with comet variation.

    • HI Ren,

      First of all, thanks so much for your thoughtful and valuable commentary it is refreshing and hope generating, we need more of this.

      I am not sure whether or not you are suggesting that the Passive BIBO Currency spec. needs to specify the legal aspects. I will assume that is the case in my response.

      First of all, there is no doubt that single most important application of the function of measuring the value of goods and service is precisely to record what is owed to one or what one owes. It is also clear that this necessarily implies the need of a legal contract.

      We have two hats at bibocurrency.org, one is as editors of a normative technical spec and the other is of implementers of that spec. As the latter we must resolve the issue of legal contracts while remaining compliant to the spec. As the former, we must provide a spec that will remain intact for all and any implementation. But the spec is normative while the contract is an indispensable non normative feature of any implementation.

      How do we go about doing this? Well, in the first instance we recognise that the question of contract is within the scope of social and economic governance which is not standardisable beyond recognising or assuming its necessity in all implementations. What I mean to say is that all implementations will have legal contracts but the limits and conditions for those contracts will vary from implementation to implementation.

      Take the question of credit limits in a mutual credit (Passive BIBO) system, how that is to be decided in each implementation depends on the community but what is clear is that in all cases all must be legally liable for their negative balances otherwise it makes little sense, This implies a contract with limits and conditions for all users. But the existence of such contracts has no bearing on the stabilty and instability of the function of money. Just as a stable unit of measure of length will not prevent a madman from designing something that will collapse the moment it is built, similarly whether or not users of a stable money spec are well governed or not (meaningful and enforceable contracts) is outside of the scope of that spec.

      Having said all that, it may certainly be the case that from the experience of several implementations we discover that things relating to governance need to be included in the spec. At the moment we only have hooks for such governance such as rule 3, 12, 13 and perhaps 14 too.

      Also remember, that it is an open standard and anyone is invited to participate in proposing amendments, corrigenda and/or suitable extensions.

      By the way and with regards to your query on whether “balanced” is equivalent to “BIBO (stability)”, a system may be balanced but that does not mean it is therefore stable. A stable system when perturbed will always revert back to equilibrium without having to add any inputs, while an unstable system can reach equilibrium but always by adding inputs. This is a subtle but vital distinction that needs to be understood by monetary reformers because too often the remote possibility of achieving balance is misunderstood for stability, but this is illusory because the conditions for equilibrium through exogenous factors can prove to have unpredictable costs that ultimately must be factored in.

  3. REN permalink

    A discussion I had with PBI, to paraphrase as it was several emails:

    Question: Do you plan to use compounding usury as liability on a double entry ledger?
    Answer: An upcoming contract we will have with the people will use FEEs instead of usury.

    Q: Don’t fees or usury redistribute somewhere in the system, and if you have private banks in the system, it redounds to them?
    A: We want an all public bank system, so any usury or fees returns somewhere to the system. We can then recycle the interest. A public/private system like that of North Dakota is only a stepping stone.

    Q: With the Chicago Plan, they convert debts to money, and leave the banks private. Isn’t that a better method to prevent fascism? Private bankers match creditors and debtors, which is bank function, not a government function.
    A: Public Banking Officials are civic minded, and can be elected. Besides public money systems such as AMI’s cannot deal with local CPI problems. Our system can flex to local market needs.

    Q: You need a certain amount of base money in a system of your type, plus AMI has a credit window, so I think you statement is false. They can also use credit to flex to local needs, and as well they can also watch the CPI. (Consumer price index would be the boundary condition to prevent too much volume in money supply.)
    A: Silence

    Q: Why do you keep claiming the FED is unchanged in a public money/private bank scheme such as the Chicago plan? The Fed can no longer create credit, a fundamental change. You cannot make these claims to the public, it is disingenuous.
    A: Silence

    Q: If you want to attack the Chicago Plan, then why not attack on their real problems such as placing the monetary authority with the executive. That is a huge flaw. A monetary authority should issue public money under the law, and as a separate political entity.
    A: Our system has States in charge, which provides some political isolation.

    Q: How do you put money in the system? Your credit creation needs some sort of reference. Also, the fees create some system imbalance.
    A: We have to have Government spend base money into the system.

    Q: Do you plan to use banker tricks to turn your credit into money, like issuing loans and then forgiving them?
    A: Silence

    Q: How do you deal with counter cycle demand, for example when credit goes away and hides? I call this the comet theory; when a comet blast hits a town, the people freak out and hoard money. If the system is credit driven, then people stop taking out loans, circulation ceases, yet the credit money supply continues to drain.
    A: Since we are a public bank, we can issue credit in a time of disaster, helping the community get back on their feet. This would create countercyclical demand as we loan credit into the economy.

    Q: When you issue credit in time of disaster, do you expect to get it all back, or do you forgive the loans turning it into money?
    A: Silence.

    My take…they didn’t like me quizzing them. Overall though, much better than Private Banks with usury credit creation privileges.

    Money stands on its own power. Money circulates without. draining and hence must be taxed out of the supply; but taxes are a blunt instrument. Credit has a future tense as it is a loan against the future. Credit must be paid back to prevent an asset seizure. A system of this type (PBI) needs some drain and some flex that credit gives, but a mostly credit public banking system to my mind is inferior to a properly implemented Chicago Plan. I worry about fascism and the power of a public bank system to direct society. Politicians should direct society, not bankers. PBI has more of a chance than Chicago plan though, as it can be implemented piece meal, State by State.

    • The problem with any interest is that it destabilises the system and having a built in perpetual deficit is only one of the symptoms that recirculating interest may alleviate. The instability of interest feeds back into the system as that cost is incorporated in prices across the value chain.

  4. Simon Barber permalink

    Another solution would be to tax the interest private banks charge on credit money loans. Of course getting this tax past legislators with the might of the banking lobbey against it would be an uphill battle. Implementing the tax at a state or local level might be a solution.

    • yes, but then we would still be losing 50% of our income to interest (see https://realcurrencies.wordpress.com/2012/01/17/budget-of-an-interest-slave-2/)
      The Government is not the commonwealth.

      • Simon Barber permalink

        But at least that interest would be coming back to us in terms of government services or reduced taxes. This would remove the wealth transfer from poor to rich.

        • The instability caused by interest cannot be solved by redirecting the interest income and it is the very instability of the system that creates the justifications for charging interest. Instability is not defined by whether or not the interest can be paid it is defined by the fact that if either the interest or the principal is not paid the debt continues to grow.

  5. What about the idea that all debt is just a book keeping record of previously created loans? Some how the idea of interest on money loans has infected the mind. Loco Lola, first woman Jesuit, says money interest is “smoke of the devil.” Others point out that the concept of interest on money is absurd. How can anyone believe that money, unlike anything else on the planet, can grow without, air, water, earth or sunlight. Think about it? thanks RDW

    • I’m not sure, rduanewilling: are you suggesting we’d disagree on this? I don’t!

  6. The problem with the PBI is that it does not understand the system technically. In fact Ellen Brown advocates the charging of interest by Public Banks on the mistaken belief that because Public Banks recirculate interest the instability of interest is resolved. This, in spite of being alerted to the fact that the instability of the system is NOT a function of whether or not the interest can or cannot be paid but rather it is a function of the fact that if FOR WHATEVER REASON either the principal or the interest is NOT paid then the debt continues to grow. This subtlety is very important because it shows that the answer is the elimination of interest not compensation for it. Such is what conforms to the Control Systems Engineering theory and practice and the mathematical definition of Stability i.e. Alexandre Luyapunov’s stability theorem which is the basis of Bounded Input Bounded Output (BIBO). The priority is clearly what Banking does not whether it is private or public. The fact that many Public Banks have destroyed opportunity and enslaved their people is sufficient proof of this elementary conclusion. We will not progress in this domain if people believe feel that they can invoke opinion where the math and the science of the matter is available. Many do not realise that the option to “agree to disagree” or to opine is only reasonable when the discussion is about personal taste or when it is about something where the data set is complete, but it is not acceptable when formal proofs are available, not only is not acceptable it is irresponsible, capricious and obstructive to counter such proofs without solid counter proofs but instead “opinion”. In the case of money and finance the data set is complete for a complete evaluation of the system in mathematical terms, it is 100% known as it is a 100% a human made phenomenon, not a natural mystery.

    • Above I meant where I write: Many do not realise that the option to “agree to disagree” or to opine is only reasonable when the discussion is about personal taste or when it is about something where the data set is complete,

      I clearly mean “…where the data set is INcomplete”

      Apologies

    • I agree with your basic message Marc.
      As you know I believe comprehensive reform should be based on Mutual Credit, which is BIBO compliant.

      Public Banks are not ideal. But I view all this purely from the perspective of the struggle against the Money Power.

      Since Public Banking does address the interest drain to the Plutocracy and since it is so easy to implement within the current structure and paradigms, it is a very important weapon in the arsenal of the Anti Usury Activist.

      This struggle is one of one step at a time. We should not judge systems on their utopian potential, but on their relevance to the struggle here and now.

      • Hi Anthony,

        I think it is significant to note that Ellen Brown believes that redistribution of interest constitutes stabilising the system and that interest is justified. It is also significant that she believes that interest is not an important issue and that making banking public is far more important. Finally, it is very revealing that when confronted with the science of BIBO she would refuse to recognise its veracity without of course offering any proof to its lack of veracity if indeed that is what she believes. In fact her argument is the following:

        “The arguments for interest are that (a) it covers defaults, (b) it discourages “carry trades,” where investors borrow at zero and invest at 3% in some safe investment overseas, and (c) it discourages “irrational exuberance,” where everybody and his brother thinks that if he just had a million dollars he could strike it rich with some invention, which never pans out, so he just keeps rolling over the loan at no cost to him till he passes away.”

        and

        “I don’t believe interest does destabilize the system — if it’s a public system and the interest goes back to the public. And I’m talking about the case where the person simply can’t pay. Interest gives him the option of carrying the loan another year. Otherwise they’ll be rolling them over every year and not paying, ever — why should they? Or you’ll be throwing them in debtor’s prison for not paying, if they don’t have the option of rolling over.”

        to which I responded:

        ……………….

        On Oct 14, 2011, at 12:00 PM, Ellen Brown wrote:

        I don’t believe interest does destabilize the system — if it’s a public system and the interest goes back to the public.

        MG: But stability is not a belief it is a clearly defined mathematical concept used in engineering and science that states that anything that grows as a function of itself is unstable by definition. It is not an opinion it is a scientific fact. What definition are you using?

        And I’m talking about the case where the person simply can’t pay. Interest gives him the option of carrying the loan another year. Otherwise they’ll be rolling them over every year and not paying, ever — why should they? Or you’ll be throwing them in debtor’s prison for not paying, if they don’t have the option of rolling over.

        MG: This argument does not follow logically. First, interest is not the only means of getting people to pay their debts, threat of foreclosure is the principle means. Second, there are many reasons why many will pay their debts without having to be coerced. Thirdly, why would debtors prison be invoked with interest free loans when it is not invoked with interest bearing loans?

        …….

        So it is really a question of representing the science of the matter properly rather than one of strategy. I agree with you that any movement that questions the exclusivity of banking can be viewed as positive but at this late stage of the game, we cannot afford to ignore the true science of the matter which also brings equanimity to what often is a hot, emotional and potentially explosive confrontation.

        Marc

        • We agree on the science, thanks for this elucidation.
          We also agree on the argumentation.

          Ellen’s argument about the carry trade is interesting though, I’d not seen it before and it certainly does have merit. However, when thinking of a mortgage, for instance, it is difficult to see how it would stand. The loan can be appointed with the condition that it will be used for said purpose.

          Since interest rates will typically be lower in PBI, it will also see at least less instability.

          However, although you are right about the intrinsic instability of the system (including PBI), PBI does retain the interest within the community. Destabilizing as it may be, it does stop the drain to the plutocracy, which is my most pressing concern.

          I think the conclusion still stands: PBI is far from ideal, but it is a pragmatic approach to lessen our dependence on the money power.

          • The carry trade does not affect stable currencies what ever is bought with stable currencies is simply an asset and that can include other currencies. However, it is hard to imagine why one would opt for trading a mathematically stable currency for an unstable one where you can win but you can lose. So a stable currency is even idiot proof.

            The other question of retaining currency in the community by recycling interest can be made with the current system, banks spend their income after paying savings. If the PB charges interest it cannot outlaw it and it must pay interest too so everything repeats itself.

            The key is to realise that the system is the result of a false paradigm i.e. one where money is viewed as scarce commodity when it should be viewed as a mere unit of measure. By charging interest you create the very excuse that justifies it, that is once you have the systematic instability you are forced to compensate for it and that compensation is required everywhere. So it matters not who charges interest for the false paradigm to unfold. This too is a subtle observation that cannot be overlooked but is by the Social Credit people and PBI.

            • REN permalink

              At its most fundamental level, money is used to stand in for a good during a transaction. Money settles a debt/credit contract. This contract is made subconsciously as a function of our evolutionary design. If I borrow a lawnmower, I have to return it to settle the contract, or I can use money to stand in as the lawnmower good. If I don’t return the lawnmower, the some sort of recompense, or legal force may be invoked. BIBO does not deal with the legal nature of the debt/credit contract. It assumes the legality is usury and grabbing of assets.

              – First, interest is not the only means of getting people to pay their debts, threat of foreclosure is the principle means-

              This statement is only true for Credit, not money. Credit always has an asset attached, and threat of loosing that asset is the coercion. What if debtor doesn’t allow his asset to be grabbed, maybe he skips out of town? Then the law must be invoked. Always, money…and credit, has at its root…law. Aristotle taught us that centuries ago, and we cannot wish it away. Do we then wave our hands and say a certain percentage of credit will be defaulted, including BIBO credit? Therefore the whole community must pay more to cover the defaults? Then we invoke the law again.

              Another BIBO function assumes that unskilled labor is the root standard of value. There are five modes of production: Labor, Capital, Land, Public Commons, Ancestral Wealth (from our forefathers, which include knowledge). Credit always attaches itself to these modes, assuming they are an asset to be monetized. Who decides what value unskilled labor has? That is a poor boundary condition. While pretending labor has a certain root value, extension of any credit type ultimately falls upon the five modes and further falls upon the law. Those are the real boundary conditions, and those conditions are common to all money systems.

              The next unavoidable fact is that money has a flip side, and that is fiscal policy. Monetary policy and Fiscal policy work together…there must be taxation. If a monopolist ends up owning the means of production, as well as earth’s stored energy (minerals/oil), then all money systems break down. Who can trade their output, if they don’t own their output? Again, we are back to the law, and the inexorable logical conclusion that money and credit, is a public good. If it is a public good, then we need laws to protect our collective money supply or credit means.

              The only bounded system is one that is bounded by the law. Assuming credit powers and assuming labor values are not boundary conditions.

              • HI Ren,

                A Passive BIBO Stable system is stable because both input (price) and output balances ( negative and positive ) of ALL transcations are bounded values and it is Passive because output never exceeds input. The question of whether people behave properly, i.e. abscond or honour their debts, is another question and has nothing to do with whether the money system is stable or not. A stable money system wiill reflect equally well the expenditure of human energy in the form of goods and services. What those goods and services are, is determined by the culture and values of society.

                If we are a bunch of bums that want to cultivate drugs and alcohol and exhaust our energies partying for months on end, our economy will grind to a halt, but not because of the money system, but because we don’t know how (yet) to do anything useful.

                On the other hand, if we are diligent and build a tradition of producing great high quality food, housing, clothing and products with no programmed obsolescence, with a 15 hour work week and lots of free time to interact and build cultural, knowledge etc..then we will have a stable economy BUT NOT BECAUSE THE MONEY SYSTEM IS STABLE but because we (society) made wise cultural value decisions.

                Now, in our case today, we are neither bums nor highly diligent wise men but our economy is highjacked by a false money paradigm and our production has become an S curve (logistic function) BECAUSE WE HAVE AN UNSTABLE MONEY SYSTEM.

                The point I am making is that our behaviour is not affected by a Passive BIBO Stable money system and it will provide us the freedom to ruin ourselves for our lack of merit as well as to build a stable and happy society full of merit. But an unstable money like ours today spells certain ruin.

                Therefore, we must separate the specification of money from the governance of society. Money is an auxiliary tool nothing else and it cannot be both a stable measure and a scarce commodity. If it is the latter then money tends to become a control lever value instead of just an annotation of value, this is what underlies the justification of interest which is what destabilises the economy in every case. If it is the former then stability of the economy is due to social governance only not the money system.

                Think of it this way, the stability of a ruler has nothing to do with a poorly or well built edifice. But on the other hand, you can’t build a stable edifice if you use an unstable measuring stick. Read the short story in this piece here: http://bibocurrency.org/English/The_Great_Fukushima_Transaction.html

  7. The problem is not debt, it’s interest Nik! Check out this article: https://realcurrencies.wordpress.com/2011/10/07/the-problem-is-not-debt-its-interest/

    The cost of Public Banking is far lower than Banking, either normal banking or in a Gold environment.

  8. Nik permalink

    “Interest free credit is superior to debt free money in many respects. It is easier to take out of circulation, because the debt will be payed off….”

    err…

    Debt free money can liquidate Debt out of the system. What is referred to here as ‘Credit’ in this system cannot. The interest being paid back while self-liquating in a systemic way, transfers the value system away from the goods & services market to politics, in the same manner that a Gold Standard transfers the value system to the Gold away from the G&S market.

    Never the less, it would be a positive option for people to have access to for other reasons.

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