Why Can't the Government Create Money?

It's gibberish to you because you have no understanding of how money is created and issued. It's a shame you have to resort to antagonism rather than simply ask for further clarification. I try to avoid engaging with those who are mentally unhinged but I am rational and humble enough to give second chances.

The Sovereign Money system seeks to withdraw from private banks the power to create money and return it to a public body for the national interest. It wants to redefine money so that it is no longer created as a debt by the private banking system. This is primarily because under the current system, money exists as both private debt and a means of payment. The compulsoryidentification of money and debt just creates banking-doctrinal confusion. Itconfuses the instrument with the object, i.e. it erroneously identifies theunit of account with what is accounted or measured, and confuses the means ofpayment with what has to be paid. Thecreation and issuance of money can, but need not, involve a financialtransaction of lending/borrowing and redeeming. To maintain that debt can only be repaid with debt (a logical implausibility) ignoresor misrepresents 2,500 years of coin currencies when new, additional moneytypically was not loaned into circulation against interest, but spent intocirculation debt-free by the rulers who had reserved for the state the monetaryprerogative of coinage and seigniorage.

Are you talking about M0, M1, M2 or M3? Do you even know the difference?

The physical notes and coins are created by the central bank and the treasury, respectively, but constitute only 3% of the entire money supply and is supplied by the central bank as central bank reserves to satisfy withdrawal demands by customers from commercial banks. The rest of the money supply is created digitally as debt, wherein the commercial banks have a proactive role while the central bank has a reactive role.

This is just hilarious. You don't know the first thing about monetary economics and you're using all these words you don't even know what they mean.

2.3%, actually. But good guess.

Broad money is just credit. There's nothing complicated about it. We can all extend credit simply by writing an IOU note.

What don't I know? Why are you being so presumptuous? Is there a reason why you are incapable of being specific?

I never argued that it is complicated. You appear to be countering a point that I'm not making.

We, the general public, are not legally permitted to create money. Did you not know this? The private banks create money in the form of debt through the process of loan-making. The problem is that debt-based money does not serve the public interest and produces asset-price inflation.

It's gibberish to you because you have no understanding of how money is created and issued. It's a shame you have to resort to antagonism rather than simply ask for further clarification. I try to avoid engaging with those who are mentally unhinged but I am rational and humble enough to give second chances.

The Sovereign Money system seeks to withdraw from private banks the power to create money and return it to a public body for the national interest. It wants to redefine money so that it is no longer created as a debt by the private banking system. This is primarily because under the current system, money exists as both private debt and a means of payment. The compulsory identification of money and debt just creates banking-doctrinal confusion. It confuses the instrument with the object, i.e. it erroneously identifies the unit of account with what is accounted or measured, and confuses the means of payment with what has to be paid. The creation and issuance of money can, but need not, involve a financial transaction of lending/borrowing and redeeming. To maintain that debt can only be repaid with debt (a logical implausibility) ignores or misrepresents 2,500 years of coin currencies when new, additional money typically was not loaned into circulation against interest, but spent into circulation debt-free by the rulers who had reserved for the state the monetary prerogative of coinage and seigniorage.

just makes no sense whatsoever. The only value that money has as a form of payment is because it holds credit. So you can't decouple the means of payment from the credit system, because those two phrases mean the exact same thing.

That which must be repaid does not necessarily have to be regarded as the same as that which must be used to pay with. It can, and I argue ought to, be separated in order to abolish public debt and taxation, as well as dramatically reduce private debt. Private banking institutions can serve as intermediaries between savers and borrowers rather than act as money creators. If you wish to argue otherwise, an actual argument is required. At the moment you're simply making an unfounded assertion, ignoring the fact money has been controlled by the state for 2,700 years. The Guernsey island currently spends a portion of money into its economy without a corresponding debt.



An insult is not a valid substitute for an actual argument.

yes we are - just apply for a licence like this bloke:

http://www.channel4.com/programmes/bank-of-dave

Are you complaining that banks have to be licensed? Is that your problem? Or are you complaining that banks invest in the wrong things? That's not a problem of money itself, its a problem of incentives.

The bit in bold is just gibberish. Of course they don't, because that would be impossible.

Inflation. Britain would go bust without a strong currency and the pound would falter.

Now I know that your method of debate is to ignore the evidence and arrogantly cast aspersions on one's intellect rather than deal with the actual substance of what has been explained. You are officially on my "don't waste your time with" list, unsound sir.

Here is the following evidence which you could have simply Googled. But your mission here is clearly not to illuminate, but to mudsling.

"This splendidly insightful piece of work was not very difficult for a simple reason – Guernsey has no debt. The government of the cash-rich island, where unemployment is 1.3% and the average house costs £346,000, does not owe any money and isn't planning to borrow any in the foreseeable future."

http://www.theguardian.com/business/2011/apr/24/credit-ratings-agencies-standard-and-poors-moodys-fitch

I know you are not doing an economics degree.