you have a good point, but it’s more complicated than that.
as you say, central banks print money. and they lend out more of it each year to the top banks, so the banks essentially get free money. they get $1B in loans the first year and technically have to pay back $1.03 next year (3% interest rate), in the second year they get $1.06 in loans though, so they pay back the $1.03 from last year and keep $0.03 for themselves. they do this each year, so they essentially get handed free money. it’s a clever scheme and discussed mathematically here (Hilbert’s Hotel).
yet that’s not all. yes they get free money, but all this happens in alignment with the political will. one could argue, that if they did not get free money from the central bank, they would just change tax law to re-distribute the money upwards instead, so it doesn’t actually make a difference. the actual issue is that politics is not acting in the best interest of the people, and this is what needs to be adressed.
Yes it is more complicated. My comment was a wall of text as it is. I wasn’t about to write a dissertation on all the complexities of it.
Of course politics plays a role. If we could get billionaires out of congressional pockets then maybe we could change some things around to serve the people more fairly.
But as it stands, they’re already changing tax law to redistribute the money upwards. It’s what we keep hearing about wealth transfer and concentration.
I don’t see why we can’t fix the tax code (i.e., tax billionaires and corporations; fund social programs that help everybody) and put an end to financial manipulation by banning these circular lending schemes and basing our currency on some type of hard assets. I mean it would require enough elected politicians who are willing to make those reforms, but still…
you have a good point, but it’s more complicated than that.
as you say, central banks print money. and they lend out more of it each year to the top banks, so the banks essentially get free money. they get $1B in loans the first year and technically have to pay back $1.03 next year (3% interest rate), in the second year they get $1.06 in loans though, so they pay back the $1.03 from last year and keep $0.03 for themselves. they do this each year, so they essentially get handed free money. it’s a clever scheme and discussed mathematically here (Hilbert’s Hotel).
yet that’s not all. yes they get free money, but all this happens in alignment with the political will. one could argue, that if they did not get free money from the central bank, they would just change tax law to re-distribute the money upwards instead, so it doesn’t actually make a difference. the actual issue is that politics is not acting in the best interest of the people, and this is what needs to be adressed.
Yes it is more complicated. My comment was a wall of text as it is. I wasn’t about to write a dissertation on all the complexities of it.
Of course politics plays a role. If we could get billionaires out of congressional pockets then maybe we could change some things around to serve the people more fairly.
But as it stands, they’re already changing tax law to redistribute the money upwards. It’s what we keep hearing about wealth transfer and concentration.
I don’t see why we can’t fix the tax code (i.e., tax billionaires and corporations; fund social programs that help everybody) and put an end to financial manipulation by banning these circular lending schemes and basing our currency on some type of hard assets. I mean it would require enough elected politicians who are willing to make those reforms, but still…