SMALL LOANS ARE DISASTROUS TOO
For those who haven't quite grasped the impact of the above, let us consider a small auto loan for only 3 years.
STEP 1: Citizen borrows $3,000 and pays it into circulation (it goes to the dealer, the factory, the miner, etc.) and signs a note agreeing to pay back to the Banker a total of $3,600.
STEP 2: Citizen continues to work and pays $100 per month to the Banker. In 36 months, he has taken $3,600 out of circulation and paid it to the bank, where it remains until someone else borrows it out again. Net result? $600 less money in circulation than before he made the loan.
Since money requirements, as is well known, INCREASE with increased population and production, and paying off any loan DECREASES the average available money supply of money, it is obvious that we would quickly run out of money completely UNLESS MORE AND MORE PEOPLE BORROW MORE AND MORE MONEY TO KEEP MONEY IN CIRCULATION!
ADD THEM ALL TOGETHER
Multiply the above examples by hundreds of millions of times in the last half century, and you can see why in that time Canada has gone from a prosperous, debt-free nation to a debt-ridden nation, where practically every home, farm. and business is mortgaged to the Bankers, and our cars, furniture, and clothes are purchased with borrowed money. The interest to the Bankers on personal, local, Provincial and Federal debt totals more than the combined earnings of the working population!
THE COST TO THEM? PRACTICALLY NOTHING
In the tens of millions of transactions made each year like those above, little actual money changes hands, nor is it necessary that it do so. Up to 95% of all "cash" transactions in Canada are by check, so the Banker is perfectly safe in "creating" that so-called "loan" by writing the check or the deposit slip, not against actual money, but against YOUR PROMISE TO PAY IT BACK! The only cost to him is the paper, ink, and a few dollars in salaries and office cost to him for each transaction. It is "check-kiting" on an immense scale!
Here is how 95% of our money is created. The private banks create a bank deposit, against which the customer can write checks. These checks move goods and services the same as dollar bills. The amount of real money in February 1980 was $8,952,000,000 in dollar bills. The amount of bank deposit check money was $ 135,345,000,000, and there was approximately 14 times as much checking money as there was real money (dollar bills).
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