EPTOn October 09 2008 18:15 fight_or_flight wrote:
Now, observe something. All of the green is actual, real money. All of the gray represents real, physical collateral which is owed to banks. They are houses, hotels, farms, schools, companies, and much more. Literally trillions of dollars worth of assets. All of which are owed to banks. In fact, the amount of stuff owed to banks far exceeds the amount of physical money out there.
The only way this is possible is if the banks obtained the rights to that collateral without actually putting up valid consideration. You see, you sign your property over to the bank and they give you money which they don't actually have. Remember, the gray on that graph only exists as digits on a computer.
So essentially, the "thin air" part comes from the fact that you trade something physical for the bank writing something on a balance sheet. Yes, it is a structured procedure. But the very fact that more can be owed, orders of magnitude more, than there is money in the economy shows that something is being created out of thin air, or else you would need an equal amount of value for the value of the collateral being offered.
Now, observe something. All of the green is actual, real money. All of the gray represents real, physical collateral which is owed to banks. They are houses, hotels, farms, schools, companies, and much more. Literally trillions of dollars worth of assets. All of which are owed to banks. In fact, the amount of stuff owed to banks far exceeds the amount of physical money out there.
The only way this is possible is if the banks obtained the rights to that collateral without actually putting up valid consideration. You see, you sign your property over to the bank and they give you money which they don't actually have. Remember, the gray on that graph only exists as digits on a computer.
So essentially, the "thin air" part comes from the fact that you trade something physical for the bank writing something on a balance sheet. Yes, it is a structured procedure. But the very fact that more can be owed, orders of magnitude more, than there is money in the economy shows that something is being created out of thin air, or else you would need an equal amount of value for the value of the collateral being offered.
this is so wrong.
