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By *itz OP Woman
over a year ago
south wales |
It was a back bench discussion opened by Steve Baker, Conservative MP for Wycombe. It has not been reported in the media as far as I am aware and I stumbled upon it by accident.
The point was put by him that the current economical system in the UK and other countries is broken, that banking in its current form (not just rogue banking) is fraudulent. He said "the methods of money production in society today are profoundly corrupting in ways which would matter to everyone if they were clearly understood. The essence of this debate is who should be allowed to create money, how and at who's risk". He explained that banks, not just the Bank of England, create money, not by actually printing coins and notes, but by numbers - on paper if you like. The Bank of England create money in order to atttain a certain interest rate, but the other banks create it for their own gains. He said "Whenever a bank makes a loan it simultaneously creates a matching deposit in the borrowers account, thereby creating money." It is termed fractional reserve banking, where the bank doesnt have the money to lend in the first place, the money does not exist. He said it is this system that facilitates the money going from the poor to the rich.
It was then discussed where most of this created money is spent. Only 8% of the money that is created by banks, including the money printed by the Bank of England, is loaned to businesses in this country. Another 8% goes to personal loans and credit cards. The rest goes back to the finacial services themselves, in the form of mortgages and suchlike. But it is for us, the tax payer to bail them out when they run into difficulty. Banks accountability, lack of governement control and different solutions were discussed.
I cant explain everything from yesterdays discussion, and i have not got a good grasp of economics, but that is true of most of us, at all levels including parliament, and is part of the problem.
There were not many members in the house for the discussion due to the Rochester Bi-election but to me it seems like a start and there will be many more discussions surrounding these issues in the future. An intersting watch. |
