Prof Werner talks about banking. He provides a clear explanation of how inequality in society is created by banks’ lending practice. Although his discussion is focused on the UK, it is relevant to Australia, and the ever rising property prices here. To quote (from the video, about 8:00):
“the real economy is booming when bank credit creation is focused on productive lending for productive purposes as opposed to speculation… money creation for financial transactions, for asset transactions, for purchasing ownership rights — now then you have a problem.
Why? Because you’re creating new money but you’re not creating new goods and services. You simply giving somebody new purchasing power over existing assets and therefore you must push up asset prices… and that also creates the inequality when the the banking sector has focused too much on unproductive lending…”
The rise in house prices:
In a tweet, about foreign direct investment (FDI) being beneficial for economic growth in the host economy, Werner wrote:
“Fdi is a sign that your country owns assets that foreigners want to buy. It is neither necessary nor sufficient for economic growth, and doesn’t demonstrably lead to growth. For growth all that is needed is productive credit creation by domestic banks.. For growth all that is needed is productive credit creation by domestic banks.”
Professor Werner – scatter gun
Pushes notion of “honest” banking being the answer with production( anyone for a frack well lotto)
Charts – front end of a bell curve ? buy Sydney
Disclaimer – I listened 7 to 9 minutes
8 min on interested me.
Off topic, excuse me. “Reap the whirlwind.” at 2mins.
This guy is fine by me.
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Very well explained. Now to correct our problem, we people who are not tied to the big four banks through home loans or personal loans, need to transfer our savings to the smaller community banks. But in saying that, there needs to be legislation to prevent large banks from being involved in take-overs as was allowed to happen in Australia during the 1960s and 70s.
The Federal Government was asleep at the wheel when they allowed the big four to buy up any competition at that period of that time and since.
The Anti Competition laws of Australia, now in place, were ignored to allow the Commonwealth Bank to take over Bank West, and when Westpac took over Challenge Bank.
I saw this vid about a year ago and I’m pretty sure I posted a link to it somewhere.
Anyhow, Werner sees a problem and explains it very neatly in terms of what has become “banking convention” but he evades the underlying fundamental of theft by usury.
ALL money is, and always has been, “created out of thin air” no matter what its token is. Even a chunk of gold only becomes “legal tender” (money) by being shaped and imprinted and accepted as a medium of exchange. Before that it’s only a chunk of yellow metal that is a barter item that some farmer might exchange for a pig if he wants to make an adornment for his wife.
Ultimately, it’s not THAT money is created (even if it’s only a data entry) but the issue is who creates it, why, and how it is released into the economy. Presently, according to what has become “convention”, money is created by “banks” as an interest bearing debt to the economy. When a “borrower’s debt” is “repaid” it ceases to exist because it is no longer circulating as money but the interest that must be snatched from other “bank loans” is pocketed by the banks as “profit” and represents an unjust, unearned, claim to real wealth such as goods and services… that’s the guts of usury.
None of this is new; but hardly anyone wants to be irked by these practicalities because they love money for its own sake. Speculators love to be able to “borrow” a claim to wealth (real resources such as goods and services) that they have no legitimate claim to with the intention of being able to defraud the producers of such goods and services and thus “repay” their debt and interest.
There’s much more but I doubt that anyone here could be bothered with it.
More punters the bigger the profits . Mass immigration increasing every day .
It’s the only industry left here .