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THE CALLING OF LOANS OR TIGHT MONEY POLICY
This section requires little need of explanation. The calling of loans has already been thoroughly explained in the previous chapter when we discussed the creation of money and how the repayment destroys it. However, a brief refresher may be in order. We said that when banks make loans to either individuals, industry or to the governments, this increases the money supply. V/e further said that when banks call loans or when loans are repaid, this reduces the money supply. It should give readers a good idea of how drastically the money supply can be affected by calling loans. I repeat, the calling of loans was one of the main factors in creating the Great Depression.
Let me illustrate.
The following figures are from the Canada Year Book:
In 1929 the total money supply per capita was ---------- $302.00
By 1933 this had dropped by 28% to -------------------- 236.00
and a depression followed
In 1934 it was-------------------------------------------- 237.00
In 1935 It was-------------------------------------------- 247.00
In 1936 it was-------------------------------------------- 262.00
In 1937 It was-------------------------------------------- 273.00
In 1938 it was-------------------------------------------- 274.00
This is an average increase of $7.65 per year. However, the war broke out in 1939. This started a war economy. By 1945 the per capita money supply had risen to $531.00 and by 1969 it had risen to $1,571 per person. I don't believe there is any more damaging evidence available that the MONEY MONOPOLISTS were the culprits that were responsible for the Great Depression. Furthermore, it also clearly shows the power that these Financial Monopolists wield over the economy and therefore over the lives of the people.
FOR THE GAMBLERS AMONG MY READERS
To grasp the truth that periodic withdrawal of money through interest payments will inexorably transfer all wealth in a nation to the receiver of interest, imagine yourself in a poker or dice game where everyone must buy the chips (the medium of exchange) from a "banker" who does not risk chips in the games, but watches the table and every hour reaches in and takes 10% to 15% of all the chips on the table. As the game goes on, the amount of chips in the possession of each player will go up and down with his "luck." However, the TOTAL number of chips available to play the game (carry on trade and business) will decrease rapidly. (continued next page)
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