Do you have an opinion about the Currency Collapse theory?

That's a very good point because of course people's savings are themselves debts. They are the banks debts to the savers. If the bank can't make money off the debts other people owe it, they can't pay the savers back.

Higher amounts of overall savings equals higher amount of overall debt. And vice versa. In the current system.

The real problem we have at the moment is that savings, are not actual savings. They are investing. More bank deception.

 

Actually that's wrong, rest is kinda right but heading in the right direction.

Banks can pay off any deposit, regardless of the performance of loans as it's doesn't use deposits to create loans.

Savings are not investing, again banks don't require any deposits to create money.

 

Then how do they create it?

 

Various books which I have read recently. The Future of Money by Bernard Lietaer, Sacret Economics by Charles Eisenstein, The Soul of Money by Lynne Twist and The 3rd industrial Revolution by Jeremy Rifkin.

I was simply stating some fundamental changes in our economy that could eventuate before collapse. I'm not proposing a utopia, or any categorised or referenced form of anything. You are quick to label these things using words that have a huge amount of social baggage attached. Instead of calling it an agenda and some "ism" word your generation has been burnt with, just look at mentioned problems subjectively. At the end of the day, I am saying these changes could be consciously taken into effect, and not forced out of collapse. Just because I post a quote, doesn't mean I believe everything the author does.

I have no idea on what a manifesto is, and am not even 100% on goobledegook. Your words are a heavily filtered with cultural memes, and assumptions. If you oppose the changes/problems I mentioned, what would your argument be instead?

 

Oh dear.

You were doing so well.

 

By creating the money in the first place is inflating the currency. Destroying it will have an opposite effect. Savings would have more value.

Traders? I think you're missing the point. Exchanging of life supporting goods is an economy. Money facilitates that by providing a medium of exchange. How is massing the medium of exchange and getting rewarded for it fit into an economy positively?

At the moment having money in the bank will earn interest, so the only motivation to use this available economic energy would be to beat the generic reward. In a negative interest environment you will be penalised for holding unused money, therefore the motivation would be to maximise its use back into the economy at any quantity. In this example, money in the bank will be indirectly used by someone else who will pay the cost of the interest to invest back into the economy. But the example shows the ultimate end goal of money as hoards of stagnant wealth doing nothing, as all currency is created with debt permanently attached and only creates usury.

And the answer to that question is how we could prevent the need for savings and investments. I would say there are many ways an economy could function. To say what we are doing now is the only way would be naive.

I'm sorry, I don't have all the answers. But maybe I can trigger thought that could lead to some? Perhaps I am doing that now?

 

Out of thin air!

They use a promise say a mortgage which is a pledge by someone to pay the bank back under terms in the pledge. Then the bank takes ownership of the asset and creates money against it.

Literally it is made up by the bank.

 

I think the biggest ideological hurdle is people linking wealth directly to money itself, and not what it represents.

"creation of money has in many ways impoverished us all. Conversely, the destruction of money has the potential to enrich us." Charles Eisenstein

 

Yeah he does go on like some airy fairy crack pipe hippy a bit at times. But he is very educated, and describes issues very well at the most unbias fundimental level, and that's what I love about his texts. The big one is Chapter 12, Negative-Interest Economics, and basically from then on.

 

It's a classic one. If one doesn't agree with somebody, but lacks the arguments (or is unwilling to reveil the real denial reason), he declares the other side as a margin value (in this case 'utopia').

 

Aren't savings (after production of course, not after creation of cheapskate money) actually money that isn't spent for now, so that the production they were earnt for, sees 'less money' against it, thus drops prices, or allows working less hard/more free time?
Savings increase the purchasing power of the money that IS spent.

Of course, this 'saving' should be 'actually' the case, if you put the earnt $100 on a bank deposit and the bank lends it out directly, then that effect is gone of course.

 

If ending usury economics and the debt and death slavery attached to it is a utopia, then we are all doomed.

"is it really who you are to say, "I will lend you moneybut only if you give me even more in return"? When we need money to live, is that not a formula for slavery?" Charles Eisenstein

Since we currently have the same exact element for store of value and for medium of exchange, the less exchange going on, the more valuable it becomes to hold, and we get a runaway effect into a depression. So you are right about the value going up, but it doesn't make sense to spend something going up in value, but to hold it. Holding economic energy from use is counter intuitive to the purpose of an economy.

 

Pirocco is correct. Increasing savings just creates deflation (or reduces inflationary pressures). This is a good thing.

In terms of your comment, people simply do not want to hoard money for the sake of it irrespective of its increasing worth. Everyday we still need to consume things and at some point even deflationary things are consumed. You just have to think about computers, telecommunications, cars etc to see that. You don't put off your purchasing forever.

 

Of course you must spend money to live on an individual level. I was talking on an economy wide level of excess wealth. In every past recession, we still have the underlining things that money represents, we still have an abundance of food, industry is still there in idle factories. What Eisenstein's neg interest theory suggests is that by targeting economic hoarding directly, the economy will reflect the underlying abundance, and not the opposite. That wealth can be a measure of economy participation and not isolation and extraction. That is we can achieve this, there would be no need for an individual to store wealth at all. (but there are some major obstacles before it could be tested practically, it def isn't a flawless plan, more a goal that we could strive for.)

It is the very idea that we each need to hoard wealth to live our lives that needs to change. It is a fabricated form of competition that has started this civilization and I believe we can figure a system without it now.

 

It's abit hard to follow the links you see between elements and the way it would lead to your statement that saving instead of spending would be bad for the economy.
People use as storage of value a plethora products. Fiatcurrencies, houses, bonds, stocks, commodities, just about everything that doesn't perish over their planned storage period. Alot even more simultaneously ('diversifying') and yet others swap alot among the choices.
Your view on the whole is like totally upside down. It's like you are reading a blueprint of a central planned theft.
Again: what is saving: it's producing without spending.
That means, as long as the savings aren't spend, your production is 'extra' for sale, and prices thus drop and/or working pressure drops.
Simply because a demand parameter stayed while a supply parameter increased.
Later on, when the savings then ARE spend, the opposite happens: prices increase and/or working pressure increases.
Notice how both annihilate eachother. What does that mean? Well, simple: the sole difference between saving and spending is... time. Time preferences of people.
So, if you see saving as bad, then that implies that you see peoples time preferences as bad. The next question is then this: who is better to judge, you, or the whole of the people together, as a decentralized made sum?
In your next post you say that you were talking on an economy wide level. Actually, you weren't, I am. The purpose of an economy is simply to make sure that people have to produce in order to spend. Regardless the order (first produce, then spend or first spend then produce). Saving versus spending is just a choice of every individual, and the economy wide total net result is just a consequence of it. If it weren't the central planning thieves that manipulate / force in order to drain off as to be able to buy without having to produce, ever.
If all prices drop, then that implies that people produce more and/or buy less. Without the measurement parameter (ex fiatcurrency) changing of course. And when does a measurement parameter changes? When the central planning thieves manipulate, along intrest rates, extra fiatcurrency creation, and more openly, force (tax).
It's their theft that redirects your economic 'energy' towards their lazy pants pockets, and the consequences of that are the start of your vicious argument circle, and runaway effects into depression.
Not saving, but theft of savings.

 

Do you realize the far reaching consequences of what you say here?
It would end the allocation of products in time.
It would make people extremely vulnerable to even a small change.
It would end speculation.
The next autumn, no squirrels hoarding.
The next winter, all squirrels dying.
The next spring, no squirrels left.
The next autumn, no fruits spreaded.
The next spring, no new trees.
The next decade, no trees left.
The next decade, rainwater washes away the ground where the trees stood.
The next decade, desert.
The next decade, no life.

 

1 - I can't say you're wrong. What you say makes sense and something similar has already happened in the past. Yet, my point is: a big part of stock investors are long-term investors (not speculative daily traders). These people study the fundamentals of Finance and Economics and they constantly look at them to validate their strategies. Moreover, in order to survive and maximize earnings, they must be intelligent and humble at the same time. Those are precisely the qualities needed in order to be open-minded. And open-minded is exactly what one needs to be in order to perceive (or at least acknowledge) the supposedly currency collapse that is coming. However, all of these people (or at least most of them) don't see the currency collapse theory as a real threat (otherwise they would have already moved to precious metals and made their value to skyrocket) and I wonder why. That's still a conflict in my mind.

3 - Very hard to understand but I see your point. Well, I'll just have to investigate a bit more and meditate about it.

 

Ok, but whose money would be destroyed? Who would lose what they have at the moment?

Let me give you 2 cases:
1 - With your solution (negative rates), rich people could just "trade" their wealth in order to pretend they are working and thus avoid being penalised.
2 - With my solution (no captial interests), rich people would simply not have any benefit in having their money at the bank (other than protection).

Actually, that's already happening to some extent (once inflation is more or less equal to captial interests, at least in my country).

Sure, and actually I have some ideas about how it could be achieved. But those are for a futuristic society, not the one we have nowadays. Anyway, that's a discussion for another thread.

 

Never heard of such thing. Could you present some links to back it up?

 

1- We have covered how the masses throughout history are wrong. "Ad populum" arguments simply don't count. The definition of "truth" is to have ALL the facts. Well you claim that these investors study the markets which is not completely true. I know great many graduates and professionals in finance that have absolutely no idea or the WRONG idea about the economic system, how money is created etc. Do not underestimate the power of indoctrination of the education system which is designed to teach lies then when you attempt to explain to someone educated with say a commerce degree how the system works they suffer cognitive dissonance. It can take 2-3 years before they come back and say I've looked at it and you are right.
When I met Prof Steve Keens, nothing that I said was at all controversial, in fact, he was amazingly informative about how the system works and love to speak about its history. There were a few points of contention though but it was simply about the intention of those in control not how the system operates.

Again never underestimate the stupidity of people.

3- It's really not that difficult to understand. "The problem is getting through the indoctrination and false assumptions".

If you manage to do that then you can more easily question things and make it a habit. Problem is as men and women we almost always are oblivious to our assumptions especially those that have been imprinted upon us from a young age.