tag:blogger.com,1999:blog-6476989946886057900.post2065538534831463821..comments2022-11-09T08:34:43.240-08:00Comments on <small> <i> the </i> </small> Mechanical Money <small> <i> blog </i> </small>: A Logically Coherent Theory of Retail Banking and the Creation of Modern MoneyRoger Sparkshttp://www.blogger.com/profile/01734503500078064208noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-6476989946886057900.post-20638385459066156652022-02-19T09:53:47.965-08:002022-02-19T09:53:47.965-08:00Hi Josh,
I have a newer post on this blog site. N...Hi Josh,<br /><br />I have a newer post on this blog site. Now I would respond that your bank lender is giving you 'tickets'. Money as a 'ticket'. <br /><br /><br />So, I would agree that the bank is giving me money, thereby becoming a partner in my business.<br /><br />Then we look at what the bank is doing. We wonder where does the bank get ALL THESE TICKETS that are being loaned? It indeed seems that money/tickets are being created somehow.<br /><br />I fear that it is far easier to create tickets than to recover/vanish them.<br /><br />RogerRoger Sparkshttps://www.blogger.com/profile/01734503500078064208noreply@blogger.comtag:blogger.com,1999:blog-6476989946886057900.post-52175147842391635162022-02-18T06:20:17.587-08:002022-02-18T06:20:17.587-08:00Roger,
I'm thinking in terms of construction...Roger,<br /><br /><br />I'm thinking in terms of construction or farm loans. The preloaded money in the loan account feels like a "promise" to the borrower. It's like the bank is saying, "We'll take a risk on your proposal. We'll transfer emblems of our support for you to the lumber yard or the seed company in order to get you going. At the end of the season when you sell your houses or your crops, we'll take the money back which you borrowed, plus a little more. We'll use that 'little more' to cover other risks we are underwriting and keep the whole process rolling down the track."<br /><br /><br />The bank is lending money, but that money is merely a promise to cover the costs of building or farming until the newly created housing or crops are realized. (Somewhere in the bank, there has to be "real" money deposits, doesn't there? Money that was deposited by savers who had been productive and had actually produced real wealth?) Those newly created houses and granaries filled with wheat are real wealth and are traded for money, part of which goes back to cover the loans taken out. The profit, if there is one, is not destroyed with the retired loan or bond. That, or part of it, is put back into the bank as interest and used as a foundation for further lending.<br /><br />How's that? I'm I getting it? <br /><br />It still feels like to me that much of that lending and borrowing activity is a gambling or risk taking enterprise with rules that keep it from spinning to far out of control. Money, when it stopped being sea shells, or pigs, or gold coins became an object of shared belief between the people who had faith that it represented the potential to become something they desired.<br /><br />We better hope we, the entire world, continues to believe in money and the hope it represents.<br /><br />I still am wondering how the government feels about tens of thousands of lending institutions creating money, money which is backed by its "full faith...etc." Is the Fed really in control of the money supply? It doesn't feel like it.<br /><br />Still thinking.<br /><br />JoshAnonymousnoreply@blogger.com