Solving the Debt Problem & Financial Crisis: On Monetary Reform with Ben Dyson

The crisis in banking, housing, debt and unemployment is a single massive and recurring problem that deserves the examination of systemic solutions including monetary reform.

After providing an extremely clear and compelling presentation on monetary reform at the 2009 American Monetary Institute Conference, Ben Dyson is interviewed by Local Future founder Aaron Wissner to discuss the causes of the crisis, how banks create money, and how to prevent a recurrence of this crisis in the future, and perhaps to also bring a quicker recovery now.

The current monetary system is structured such that most money is created when loans are created.

Under the current "fractional reserve" banking system, when a loan is made, 90% or more of the money of bank depositors can be loaned to the borrowers, but at the same time, the depositors consider 100% of that money available, and everyone treats deposit money as if were the same as cash.

The money that is loaned out then is paid to someone, and that money is typically again deposited back into the bank, and again around 90% of this deposit money is lent out by the bank. This process continues until the total amount of checking account "money" increases by 3, 5, 10 or even more times.

Banks have very little cash even though they have very large amounts of deposits. The deposits are backed almost entirely by the loans that the banks have made, and most of these are mortgages. In the event that the loans go bad, the deposits do not have adequate backing, and the bank becomes insolvent, leading to a monetary crisis.

A monetary crisis leads to a housing crisis or mortgage crisis, a credit crisis or financial crisis, an unemployment crisis and revenue crisis for government entities, a banking crisis and insolvency crisis for banks, and an overall debt crisis and money crisis for everyone.

Monetary reform attempts to add resilience to the monetary system by making improvements to the accounting rules that banks must follow, improvements to the monetary policy mechanism, and improved ways to issue money into circulation.

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[Independent0bserver]

@ExclusiveLM

Central bank notes are IOU's ... evidences of debt.

You cannot pay a debt with another debt.

We are all unknowingly merely discharging debt's ... not paying them.

Not that all our debt's aren't already pre-paid.

Unless one believes they must pay for their inheritance that is.

A person is always a man, but a man not always a person.

Don't get caught up in the trifles of usury.

Dead law, living law, which should I follow?

[Independent0bserver]

@ExclusiveLM M. McLuhan "the medium" is the message ... he was making a case for TV but in this case the "medium of exchange" is the message. No one sees what is right in their faces. Until usury (the true meaning of usury) is wiped out, all else is futile. We measure ouselves with a crooked stick. Not that it's intended we measure ourselves in the first place but ... there is only one source of credit. The MoE is best spent into existence, not borrowed.

[ExclusiveLM]

At least i'm smart enough to see the problem most people refuse to acknowledge. Corporate Treasuries and Banks have most of the money on Earth. It's that simple. As long as big companies hold on to their earnings to satisfy their share holders while merging with other companies and firing half of the staff to save on overhead after each merger the economy will continue to go to hell in a hand basket. That's why you see people protesting all over the world. PERIOD !!

[ExclusiveLM]

@Independent0bserver At least i'm smart enough to see the problem most people refuse to acknowledge. Corporate Treasuries and Banks have most of the money on Earth. It's that simple. As long as big companies hold on to their earnings to satisfy their share holders while merging with other companies and firing half of the staff to save on overhead after each merger the economy will continue to go to hell in a hand basket. That's why you see people protesting all over the world. PERIOD !!!!!

[Independent0bserver]

@ExclusiveLM McLuhan was certainly correct ... the medium is the message. The "medium" everyone is missing the message of in this case is, the "medium of exchange".

[Independent0bserver]

cont... After all, this is the only logical way to fund government, by floating liens and debt to the registrants in the form of benefits and privileges. Without realizing it, every American will insure us for any loss we may incur and in this manner, every American will unknowingly be our servant, however begrudgingly. We will employ the high office of the President of our dummy corporation to foment this plot against America.

EM House

[Independent0bserver]

@ExclusiveLM

Once a nation parts with the control of its credit, it matters not who makes the laws.

William Lyon Mackenzie King

Until the control of the issue of currency and credit is restored to government and recognized as its most conspicuous and sacred responsibility, all talks of the sovereignty of Parliament (congress) and of democracy is idle and futile.

William Lyon Mackenzie King

[ExclusiveLM]

@Independent0bserver you are completely off your rocker independent0server. You say the gov has to control something that is being controled by big businesses. That is not logical. Most of the money is being held by corporate treasuries and banks. Until those 2 entities get their act together, the gov can't regulate supply and demand. For one companies could just say i'm going overseas to do business if they feel squeezed by the gov. Come on, you don't know your stuff

[Independent0bserver]

Supply vs demand = price. One of gov't true rolls is to ensure this occurs naturally without influence. Equilibrium is a natural state all systems strive for. What the vast majority miss is the inherent design flaw of usury. Math, logic, morality and scripture all condemn usury. “Copper-top”, the purchasing power of your labor is halved approximately every 35 years. The medium of exchange is birthed in debt before it even enters the economy. All you mention is systemic of usury.

[ExclusiveLM]

@Independent0bserver you say the government must print non-interest bearing bills RIDICULOUS !!! The problem with the US economy lays in big companies buying up smaller companies. Then firing many employees of the companies they bought to consolidate and save money. That causes lack of jobs. Those now bigger companies have a tight grip on earnings to keep share holders happy. They control jobs and currency flow in this manner. Lopsided capitalism.