Here is an interesting article about how our current money system is based in debt. I think it's correct, if you look at things in the right way. It doesn't get the full 3D picture, but it's pretty interesting nonetheless. And it does argue about getting rid of the federal reserve, which I think would be a good thing.
So, the more money you put in the bank, the more is technically available to anyone out there. Kind of scary.
2 comments:
WOW!
Not too surprising here. It's essentially straight from my first finance class. And the real life scenario is much worse than Billy and Sally. The next step would be the $900 that Sally used to buy her business from Johnny is deposited in the bank. That $900 is loaned out to Lee for his new business... etc., etc., etc.
I'm not sure if I would call our system "tragically absurd" though. I think that's a bit harsh. There are legitimate reasons, especially in business, to take on debt. And without many small "investors", read people with savings accounts, these loans never would have been able to happen.
Now... all the people that are trying to play catch-up with the Jones to fiance some TV or whatever... yeah... now we're getting "tragically absurd".
Just my 2c.
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