10 May 2019 11:14 am
That is a relationship question and doesn't pertain to who created the money.peepee » 10 May 2019 10:06 am » wrote:...hat creek has made a step towards honesty and understanding with the following post to me at https://liberalforum.net/viewtopic.php?f=3&t=41376&u=0&start=60 :
"You are aware of fractional reserve banking so I don't get how the concept is foreign to you.....
When I sign a promissory note, aka promise to pay, aka loan doc, I create something of value.
It didn't exist until I charged the instrument, the note, the loan doc, with my signature.
I assign that note to the bank, BOOM 50K CREATED and the bank CANNOT keep it...they must transfer ... 50K of new money...back to me..."
...i'm fine with this after my minimal editing...btw, who is the lender and who is the borrower in your $cenario, hat creek?...
The relationship is reciprocal. I assign MY NOTE to the bank giving them something
of value, which they in turn hand me back something of value.
The flaw in the system is of course the interest, which IS inflation. Interest IS
the cause of money devaluation because the interest is not created within the transaction
or anywhere else.