tag:blogger.com,1999:blog-7530776363222965313.post7663459373755173863..comments2023-10-07T13:16:34.756+02:00Comments on Simon Thorpe's Ideas on the Economy: Total Global Debt and Money Supply : Twice as much debt as there is moneySimon Thorpehttp://www.blogger.com/profile/02605233720415886802noreply@blogger.comBlogger31125tag:blogger.com,1999:blog-7530776363222965313.post-76019831145040129512014-12-16T03:41:46.843+01:002014-12-16T03:41:46.843+01:00Good topics & articles these are so important ...Good topics & articles these are so important for<br />anyone for get an idea about make money.This is a fantastic website, could you<br />be interested in going through an interview concerning just how you made it? I<br />very much enjoyed reading your description. I <br />offer to you http://howtomakemoney24.blogspot.com/ how<br />to make money and teaching<br />Commercial to Residential Conversion.Simon Thorpehttps://www.blogger.com/profile/02605233720415886802noreply@blogger.comtag:blogger.com,1999:blog-7530776363222965313.post-50744795059682664262014-11-30T08:28:53.914+01:002014-11-30T08:28:53.914+01:00Could be! But actually, I think that the problem i...Could be! But actually, I think that the problem is that simply that one of the datasets that I used to compile the data was out by a factor of 1000 - they used millions instead of billions for example.Simon Thorpehttps://www.blogger.com/profile/02605233720415886802noreply@blogger.comtag:blogger.com,1999:blog-7530776363222965313.post-54744186675148968852014-11-29T20:03:34.775+01:002014-11-29T20:03:34.775+01:00that is why they like inflation. Alice's profi...that is why they like inflation. Alice's profit has lower spending worth, and they can keep the confusion nice and lively.<br />The bankers only want to steal from you, they actually don't care whether the system is doomed to failure, or unfair, or anything. This is nowadays a simple matter of fraud and threft. <br />Do you think Dick Fuld really cared about Lehman, or Mozillo about Countrywide? Only as much as it gave them street cred. It was really about the cash. Just small time crooks. We should treat them that way.Simon Thorpehttps://www.blogger.com/profile/02605233720415886802noreply@blogger.comtag:blogger.com,1999:blog-7530776363222965313.post-67606752731026957302014-11-29T19:57:43.688+01:002014-11-29T19:57:43.688+01:00Perhaps most of the wealth in Mehico doesn't s...Perhaps most of the wealth in Mehico doesn't show up in the system......Simon Thorpehttps://www.blogger.com/profile/02605233720415886802noreply@blogger.comtag:blogger.com,1999:blog-7530776363222965313.post-14252982809309547842014-11-29T16:15:37.157+01:002014-11-29T16:15:37.157+01:00Unforunately no. Because most of the time, it is I...Unforunately no. Because most of the time, it is IO bank £10, UO bank £10, and HeO Bank £10. That's because Commercial Banks are currently allowed to make loans with non-existent money - and then charge interest. <br /><br />For a true mutual credit solution where things really do net out, you could take a look at my proposal for OWE'M - a system where literally you hardly need any "money" at all. See http://www.owem.net/Simon Thorpehttps://www.blogger.com/profile/02605233720415886802noreply@blogger.comtag:blogger.com,1999:blog-7530776363222965313.post-82790916987555896692014-11-29T15:59:26.750+01:002014-11-29T15:59:26.750+01:00Does the debt net off? E.g. IOU £10, UOHim £10 and...Does the debt net off? E.g. IOU £10, UOHim £10 and HeOMe £10?Simon Thorpehttps://www.blogger.com/profile/02605233720415886802noreply@blogger.comtag:blogger.com,1999:blog-7530776363222965313.post-4414828772915584842014-10-29T08:58:29.774+01:002014-10-29T08:58:29.774+01:00Hi Remy,
I think that it should be clear that ...Hi Remy, <br /><br /><br /><br />I think that it should be clear that the current system is unworkable. But, now that people are realizing that when the Banking sector lends our governments "money" (and charge taxpayers interest), they don't actually have the money they lend - they just create it out of thin air - there is a solution. Central banks can provide "money" to pay off the debt. The banks would have to destroy their "assets" in return for the money. That would help them get their assets to capital ratio down, and reduce the total amount of debt in the system. But of course, it would also kill the goose that has been laying golden eggs for centuries. Expect enormous resistance from the banking sector to keep their gravy train on the the rails....<br /><br /><br />SimonSimon Thorpehttps://www.blogger.com/profile/02605233720415886802noreply@blogger.comtag:blogger.com,1999:blog-7530776363222965313.post-59376612822110206642014-10-28T21:35:32.846+01:002014-10-28T21:35:32.846+01:00I agree with the need for more money supply.
If we...I agree with the need for more money supply.<br />If we do a rough - and irrealist - simulation by cutting as much it could probably be possible in state budget (I did it for France), it would require more than 30-40 years to pay back the debt. Sorry, I don't have this simulation here. That's anyway completely unbelievable because of well-kown politic issues.<br />About the debt, it is known that any penny you have at the bank is already not yours anymore : you only have the right to claim for this money one day or another, but not everybody at the same time of course !<br />The point is, if we double the money supply, it's like your money at the bank would have half its value. The idea is probably not a good one for anyone. Anyway, the only solution for states is to put that money in the economy - so a "rich" would be twice less rich - and to get back that money through taxes to pay back the debt to us, to every one having money at the bank even if you didn't "explicitely" bought bonds. As the taxes are not up to 100%, states have to put more because each year they also have something to pay for.<br /><br />Let's say for Euro zone, without domestic debt (gov. are not up to pay for dosmetic debts) :<br /> - Total average tax rate is 41%<br /> - Debt is 17515 G€ (business + gov. debt)<br /> - M3 = 9785 G€<br />So Euro zone would have to issue : 1/0.41 = 2.44 times the value of the debt due to "low" tax ratio.<br />The debt is already 1.79 times M3, so Euro zone has to issue :<br /> Amount to issue = 1.79*2.44 ~ 4.36 times M3 !<br />So money would have 4.36 times less than its current value. So supplying money si good for the average guy but not for the richest... that's all the point why debt is crising. Until when ? I don't know !Simon Thorpehttps://www.blogger.com/profile/02605233720415886802noreply@blogger.comtag:blogger.com,1999:blog-7530776363222965313.post-42036161493604841052014-06-21T09:39:08.656+02:002014-06-21T09:39:08.656+02:00Why no mention of M4 money supply... Why no mention of M4 money supply... Simon Thorpehttps://www.blogger.com/profile/02605233720415886802noreply@blogger.comtag:blogger.com,1999:blog-7530776363222965313.post-50896313379232618822014-05-30T06:24:01.162+02:002014-05-30T06:24:01.162+02:00Hi, Unfortunately, the Euro zone has made less hea...Hi, Unfortunately, the Euro zone has made less headway than other places in reducing this private-debt burden. Euro zone debt burden is very high as compared to other nations. Large supply of money is required to settle these debts.<br />Thanks for this post.Simon Thorpehttps://www.blogger.com/profile/02605233720415886802noreply@blogger.comtag:blogger.com,1999:blog-7530776363222965313.post-59229007408182996282014-05-21T01:12:27.265+02:002014-05-21T01:12:27.265+02:00I think the OP's reasoning is that retirements...I think the OP's reasoning is that retirements funds are backed by government bonds.Simon Thorpehttps://www.blogger.com/profile/02605233720415886802noreply@blogger.comtag:blogger.com,1999:blog-7530776363222965313.post-60806852329255565772014-05-21T01:09:55.595+02:002014-05-21T01:09:55.595+02:00Here is an alternative source for figures in the U...Here is an alternative source for figures in the USA.<br /><br />http://www.shadowstats.com/alternate_data/money-supply-chartsSimon Thorpehttps://www.blogger.com/profile/02605233720415886802noreply@blogger.comtag:blogger.com,1999:blog-7530776363222965313.post-44754925720977669492014-05-21T01:08:49.044+02:002014-05-21T01:08:49.044+02:00It would be nice for nations to owe each other so ...It would be nice for nations to owe each other so they cancel out. However, that does not seem the case here. Guess those Martians are owed a good penny ;)Simon Thorpehttps://www.blogger.com/profile/02605233720415886802noreply@blogger.comtag:blogger.com,1999:blog-7530776363222965313.post-3216631748947641672014-03-28T23:16:44.208+01:002014-03-28T23:16:44.208+01:00Thanks. You may find http://m.youtube.com/watch?v=...Thanks. You may find http://m.youtube.com/watch?v=jQuEOUzA9P8 interesting.Simon Thorpehttps://www.blogger.com/profile/02605233720415886802noreply@blogger.comtag:blogger.com,1999:blog-7530776363222965313.post-64452836119649618682014-03-28T18:39:51.229+01:002014-03-28T18:39:51.229+01:00EXCEPT with an honest const'l money eg silver,...EXCEPT with an honest const'l money eg silver, the INTEREST gets paid by mining more silver.<br /><br />IE, the PROBLEM is the UNCONST'L privilege of private bank issuance of fiat from thin air at zero cost, issued AS debt PLUS interest. <br /><br />THIS "ECONOMY" maybe called capitalism EXCEPT there hasn't been free market enterprise since the RR's bought themselves the illegtal monopoly cartel AKA the Interstate Commerce Commission, and thus the drooling banksters who owned the RRs to begin with, got theirs in the FED. And hence EVERY big biz in the land has regulatory captured the govt to its own heinous ends.<br /><br />Not one dead president, and Hamilton as well, that appears upon our fiat currency EVER contemplated an unbacked paper money as anything but the disaster their contemporary history proves it always was/is.<br /><br />INFLATION was the sole cause of the FRENCH TERROR.<br /><br />I say let THEM eat 1.6BILLION rounds of .40 caliber JHPs !!!!!!!!!!<br /><br />Gangster banksters rule the world by fraud, force and abuse.<br /><br />Please see:<br /><br />Roy Child's "Big Business and the Rise of American Statism"<br />including an excellent explanation of what historical revisionism ACTUALLY is.<br /><br />http://praxeology.net/RC-BRS.htm<br /><br />Also see Louis Brandeis' "Other People's Money and How the Bankers Use It"<br /><br />http://www.law.louisville.edu/library/collections/brandeis/node/191<br />Other sites have it in an downloadable mp3 audiobook as well<br />BTW Bastiat's short book "The Law" is highly recommended and avail at mises.org for the searching.Simon Thorpehttps://www.blogger.com/profile/02605233720415886802noreply@blogger.comtag:blogger.com,1999:blog-7530776363222965313.post-6267614921290946192014-03-18T17:42:12.942+01:002014-03-18T17:42:12.942+01:00Many people will contest that banks are simply loa...Many people will contest that banks are simply loaning deposits. So i did a little research: “In the real world banks extend credit, creating deposits in the <br />process, and look for the reserves later” (Moore (1979, p. 539)—quoting <br />Fed economist)<br /><br /><br />“In the real world, banks extend credit, creating deposits in the process , and look for the reserves later.”<br />Alan Holmes, then Senior Vice President, Federal Reserve Bank of New York (1969)<br />http://www.bostonfed.org/economic/conf/conf1/conf1i.pdf<br /><br />"the<br /> difference of m2-m1 leads the cycle by even more than m2 with the lead <br />being about three quarters" kydland and prescott Pg 14<br />https://minneapolisfed.org/research/prescott/papers/prescott-et91.pdf<br /><br /><br />“Banks<br /> lend by simultaneously creating a loan asset and a deposit liability on<br /> their balance sheet. That is why it is called credit “creation” – <br />credit is created literally out of thin air (or with the stroke of a <br />keyboard).”<br /> Paul Sheard, Chief Global Economic & Head of Global Economics and Research, Standard and Poors<br />http://2joz611prdme3eogq61h5p3gr08.wpengine.netdna-cdn.com/wp-content/uploads/2013/08/SP-Banks-Cannot-And-Do-Not-Lend-Out-Reserves-aug-2013.pdf<br /><br /><br />There<br /> is no evidence that either the monetary base or M1 leads the [credit] <br />cycle, although some economists still believe this monetary myth. Both <br />the monetary base and M1 series are generally procyclical and, if <br />anything, the monetary base lags the [credit] cycle slightly.<br />Nobel prize winners Finn Kydland and Ed Prescott , Federal Reserve bank of Minneapolis (1990)<br />http://www.minneapolisfed.org/research/qr/qr1421.pdf<br /><br /><br />Under<br /> the present system banks do not have to wait for depositors to appear <br />and make funds available before they can on-lend, or intermediate, those<br /> funds. Rather, they create their own funds, deposits, in the act of <br />lending. This fact can be verified in the description of the money <br />creation system in many central bank statements, and it is obvious to <br />anybody who has ever lent money and created the resulting book entries.<br />IMF Working Paper Chicago Plan Revisited, p9<br />http://www.imf.org/external/pubs/ft/wp/2012/wp12202.pdf<br /><br /><br />The key function of banks is money creation, not intermediation.<br />Michael Kumhof, Deputy Division Chief, Modeling Unit, Research Department, International Monetary Fund<br />http://vimeo.com/64807284Simon Thorpehttps://www.blogger.com/profile/02605233720415886802noreply@blogger.comtag:blogger.com,1999:blog-7530776363222965313.post-45182132377871027442014-03-16T07:42:52.636+01:002014-03-16T07:42:52.636+01:00i have been wondering about another thing. typica...i have been wondering about another thing. typically when a business goes bankrupt, the assets are sold to pay off the creditors. If a bank is insolvent and goes bankrupt does the sale of the assets goes to pay off the depositors. What happens, though, when a bank receives aid from the FED. They now have the money to pay back the depositors and keep the house in the event of a foreclosure. Another words, they get a house for free.Simon Thorpehttps://www.blogger.com/profile/02605233720415886802noreply@blogger.comtag:blogger.com,1999:blog-7530776363222965313.post-52330545037871749642014-03-11T14:25:25.273+01:002014-03-11T14:25:25.273+01:00Hi Simon,
excellent blog. i am researching the sa...Hi Simon,<br /><br />excellent blog. i am researching the same subjects than you, and complete books like modernizing money, where the money comes from, etc. To clear things up, i almost totally agree with Andrew Jackson positivemoney.org.<br /><br />but for the purpose of this article, there are some issues i do not think you are taking into consideration, and are clearing houses.<br /><br />BankA owes BankB 150 debt units, and BankB owes BankA 140 debt units. The total amount of debt in the system is 290 debt units, and lest suppose that the total amount of "money" (M0/M1/M2/M3) is just 200 units. But at the end of the day, the clearing system only needs to transfer 10 units of _real_ money (reserves) from BankA to BankB to clear the debt between two banks.<br /><br />So to help trying to figure out how the "machine" works, me must consider that we do not need the exact same number of "money" (M0/M1/M2/M3) than debt to be able to cancel it. Its a little bit tricky. I dont remember where i got the number, but 30% of money transfer in USA is trough clearing houses.<br /><br />In terms of debt, debt by itself is not negative. What is negative is that your production system is not aligned with debt.I mean, that the goods production structure is not able to grow to repay past debts.<br /><br />According to what we consider money, its also a little bit tricky :-). In our monetary system, a bank deposit is "money" because you can pay taxes with it, but in reality is not money, is credit-money. Money should represent a commodity that clears 100% the debt from the society when a deal finish. If Bob buys a table to Peter, and the purchase is 1 gold coin, after this purchase, the debt is clear in the system, because not only Bob doesnt owe anything to Peter, but because gold was not issued as debt in the system ;-). In fiat systems, dollars are issued as debt. But in a reformed system, like Andrew Jackson propose in the book, state issued money is also "debt" money, even if is free of interest, and this is something i discovered recently. This kind of money (that is ten times better than our system), at the end, is something related to goverment trust that will maintain the base money aligned to price levels. With gold, miners provides base money according to GDP growth and goods price levels, but in a state money sytem (that i repeat, i support it), the goverment can provide accordit to this variables ... or not, like we are seeing in Venezuela, where inflation since 1999-2012 skyrocketed to 1.200% because of base money printing.<br /><br /><br /><br />I mean, at the end, this free-debt-issued-money is also a "debt" money, because <br /><br /><br /><br />1. part of the money you get, has to return to state, central bank or treasury department that issued it. Is debt :-).<br /><br /><br /><br />2. citizens are forced to accept and trust this money in terms of inflation.<br /><br /><br />I know that this thread is old, but i wanted to share my ideas with you :-)<br /><br /><br />regards!Simon Thorpehttps://www.blogger.com/profile/02605233720415886802noreply@blogger.comtag:blogger.com,1999:blog-7530776363222965313.post-66861439374954201232014-02-03T08:38:23.500+01:002014-02-03T08:38:23.500+01:00Hi,
Great blog. I think increase in Debt is al...Hi, <br /> Great blog. I think increase in Debt is always acceptable as long as the growth rate is steady. Credit growth will do increases in capital requirements.<br /> Thanks for this post.Simon Thorpehttps://www.blogger.com/profile/02605233720415886802noreply@blogger.comtag:blogger.com,1999:blog-7530776363222965313.post-80867163796303128412014-02-01T16:11:24.566+01:002014-02-01T16:11:24.566+01:00Have you looked into the venus project? http://www...Have you looked into the venus project? http://www.thevenusproject.com/Simon Thorpehttps://www.blogger.com/profile/02605233720415886802noreply@blogger.comtag:blogger.com,1999:blog-7530776363222965313.post-45919027622061309982014-02-01T15:10:16.284+01:002014-02-01T15:10:16.284+01:00This is a consequence of interest. Interest is mon...This is a consequence of interest. Interest is money owed to financial institutions, but this money was never issued. Only principal is issued.<br />In fact, the difference between total debt and money available in the world is the lender's profit made through interest.<br />To understand this, think of a simple economy with two people (alice and bob) and a bank. The bank lends each $5, they trade with each-other and Alice ends up with $7 while Bob has $3. The bank asks for the money back after a year, but now requires $6 dollars from each. Society is in debt for $2 and can never pay it back. Alice has $1 profit, but Bob is poor now.<br /><br /><br />We can't get rid of this problem with the current system. We would need to live in a world without money to fix this.Simon Thorpehttps://www.blogger.com/profile/02605233720415886802noreply@blogger.comtag:blogger.com,1999:blog-7530776363222965313.post-39092041231403488642013-12-03T17:53:21.878+01:002013-12-03T17:53:21.878+01:00Wait, what if my debt is owed to somebody that owe...Wait, what if my debt is owed to somebody that owes me a debt? Won't that debt cancel itself out, at least in part? Can some of this debt be canceled in the same way? <br /><br />And if a lot of people owe me debt, what do I have on my books? Cash or surplus? Can we count surplus in the same way that we count debt? If so, then surplus seems to missing from this picture...Simon Thorpehttps://www.blogger.com/profile/02605233720415886802noreply@blogger.comtag:blogger.com,1999:blog-7530776363222965313.post-74144911612200689372013-11-12T07:40:33.469+01:002013-11-12T07:40:33.469+01:00Hi,
All the available figures for M0, M1, M2, and...Hi,<br /><br />All the available figures for M0, M1, M2, and M3 are here<br />http://simonthorpesideas.blogspot.fr/2013/04/just-how-much-money-is-there.html<br /><br /><br />It doesn't make the problem go away....<br /><br /><br />SimonSimon Thorpehttps://www.blogger.com/profile/02605233720415886802noreply@blogger.comtag:blogger.com,1999:blog-7530776363222965313.post-89796561756251507982013-11-12T06:26:49.910+01:002013-11-12T06:26:49.910+01:00Would it make a difference if you looked at M3 or ...Would it make a difference if you looked at M3 or M4 instead of M2? The money supply using M2 in the United States is 10.8 trillion, but the money supply by the M4 measure is 17.4 trillion. It seems plausible that, if you hunted out the M4 Money Supply for all the countries listed, you may find there is enough money to pay all the debts, after all.<br /><br />Source: http://preview.tinyurl.com/ptu8yofSimon Thorpehttps://www.blogger.com/profile/02605233720415886802noreply@blogger.comtag:blogger.com,1999:blog-7530776363222965313.post-73588146523696862392013-10-24T12:28:51.762+02:002013-10-24T12:28:51.762+02:00I'm not sure that it's necessary to write ...I'm not sure that it's necessary to write off all debt. For example, someone who had lent their own money to someone else could reasonably hope to get it back sometime. On the other hand, writing off debt that was created by lending money that is created out of thin air by commercial banks would be a very good thing. So, maybe there is an inbetween option that would be optimal....Simon Thorpehttps://www.blogger.com/profile/02605233720415886802noreply@blogger.com