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Unlimited debt creation
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Unlimited debt creation
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Steve Keen considers the following as important:
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| Unlimited debt creation |
Why the last step? Why sell to the financial sector and then the financial sector sells it back to the government PLUS interest?
Because it's been legislated by Parliaments who don't understand money creation. The interest on bonds also makes banks less likely to go on a private debt lending binge. But it is quote possible for the bonds to be sold directly by the Treasury to the Central Bank.
@stevekeen7925 It all seems like a bad sleight of hand to me. The private bankers are unnecessary and harmful intermediaries. All they do is inflate the monetary supply while making investment decisions on behalf of the public, often against public interest. They are completely undemocratic and unaccountable. It is also a very top-down system. It can't handle the sheer amount of information required to govern the system. Mind you, the public system is also a very top-down system that suffers from the same problem. Neither can handle the scale of complexity of the entire economy, which just contributes to the wild swings of the economy. Money is a representation and, just like any other representation, it can fail to represent what it is supposed to represent – both in terms of the sheer amount of volume of information that needs to be processed at the top of the system (which can't handle the complexity) and distortions through speculation and manipulation for profit.
The monetary system should be composed of cooperatively owned and democratically governed local banks. Money should be issued based on the investment decisions of the people, and the amount of money in circulation should be controlled by the development capacity of the community – the amount of labour, land, and energy available. It should be a self-organizing, bottom-up, complex system, not a system controlled by a central government setting interest rates or by private banks making all the investment decisions that shape our society.
@stevekeen7925 is my assessment correct, or am I completely off? I've been trying to understand all this from a complex systems' point of view, but I'm just one guy with books and no formal education on complex systems.