Blog 20 Optimum Stability - a Compensating Money Supply

Blog 20
After that mind-clogging title, let me quote another American President, Woodrow Wilson, who in 1913 signed the Act which established the Federal Reserve Bank, the American counterpart to the Bank of England.

But first.

Most countries now have a central bank whose purpose is 

"to regulate credit and currency in the best interests of the economic life of the nation, to control and protect the external value of the national monetary unit, and to mitigate by its influence fluctuations in the general level of production, trade, prices and employment, and generally to promote the economic and financial welfare of the nation." (from the Bank of Canada Act 1938).

(Read that again. It's written in law-speak, but it is a very good three-point statement-of-purpose for a national agency. 
Never mind, I'll re-write it for you. 1. to regulate the money supply, 2. to maintain the value of the national currency, and 3. to promote the financial and economic welfare of the nation.)

Now to President Wilson, who later wrote:

I am a most unhappy man. I have unwittingly ruined my country. A great industrial nation is controlled by its system of credit [money creation system]. Our system of credit is concentrated. The growth of the nation therefore and all our activities are in the hands of a few men. We have come to be one of the worst ruled, one of the most completely controlled and dominated governments in the civilized world, no longer a government by conviction and the vote of the majority but a government by the opinion and the duress of a small group of dominant men." 

Hmmmnn. I wonder what he would have said about the Supreme Court's recent Citizens United decisions, which have declared that "money talks in elections" is a principle enshrined in the Constitution?

Well, so much for introduction. On to the recipe for a balanced monetary system to replace the debt-based system we now suffer, and which accounts for about 98% of our money supply world-wide

That's right, about 98% of the money now used by people, businesses, corporations and governments is rented money. And the way they mainly pay the rent (interest) on that debt-based money is by borrowing more of it. Yep.

I'll leave you with a recollection of our friend, Arthur Banks, of Blog 16, who lent his neighbour 200 bucks to buy a poodle for his wife. The pet store took Arthur's little promise-to-pay note and passed it on to pay his own pet-food supplier. Remember? It was just like money. But Arthur did not ask for an interest payment.

Now that could be a real competitor for the rented money created by private banks. What if the governments of the world did that? They used to.

Next blog I'll try to give a simple explanation of a method for governments to get back to it. I'll also name two governments which have the tools to succeed.

Dad, when the government bails out banks

where does it get the money from?

From the banks

!!??!!