Allen

The only way the extange of money can create a recession or depression is if everyone saving their money just put it where is cannot be interest earning. This would play a very small role in recessions as the money will be eventually spent. This would only create a recession is a large number of people saved a large portion of their money at the same time. Which is not nor has ever been the case. What you believe is a clever calculation, is not as in accounting terms (the way we keep track of all money in circulation) creats an unbalanced balance sheet. The people who cannot repay their loans goes hand in hand with my previous statement. Yes I left that part out too. But they loan out more money to cover this. Yes I agree the money supply has to expand as we are growing larger as a nation. This is just a system that does not work, mathematically. As we have seen, their clever calculation does not work.......Recessions and depressions. The markets correcting themselves as you said are a by product of this system. There will never be enough money to pay off these loans anyways. In a way, some loan ventures are doomed to fail as not every loan is repayable. Its going to happen no matter if every business has a product everyone wants. Thus recessions are just when more loans are being called in than given out.

All I was saying was at the point ALL money is created or the supply expands the equation is simply M=M+I. If you’re going to argue with me, do it right. Tell me how the money supply grows...... Also recessions and depressions are just when more debts are being paid off rather than loans taken out. This is controlled by interest rates. As there will never be money in existence to pay off all debt and more loans are issued and assets are seized to serve this purpose. While the system is fluid, it is not anything but carefully controlled. You can see in your chart the money supply is growing. Meaning more and more loans are being issued.

Yeah just continue talking about the things that don't really apply to this forum and it's original meaning. That's a good use of your time. Let's just all argue with some yahoo that said capitalisms going to end. That seems like something you all actually have an argument for.

Ok here it is. The way the supply of Canadian currency expands is through loans **(See www.bankofcanada.ca/en/backgrounders/bg-m2). I can see that there are many people that think this system is not flawed. I mean some of the people who had argued against this are intelligent people. If ALL money is loaned to the public and private sectors, the amount in circulation will never be enough to pay the loans (due to money to pay interest does not exist). If M = all the money existing and M was loaned out at some point with I = interest . Then M would equal M+I or M=M+I. Thus creating recessions and depressions as a byproduct of this system. **Commercial banks and other financial institutions provide most of the assets used as money through loans made to individuals and businesses. In that sense, financial institutions create, or can create money.

Michael I started this forum to find people interested in talking about a solution. Not to have someone convince me the current monitary system is flawless. I know there is a lot to understand and if you want to prove me wrong, look up how Canadian money is put into circulation. Don't take my word for it. If you don't care enough to put in this effort then you are defending a system that you do not understand and should stop. Ask yourself, if you want brand new money, how are you going to get it?

Don't be so quick to discourage new ideas. That would be what I am saying but there are plenty of ways to use supply and demand. We can let people rip eachother off. Kind of how scalpers work. Or we can lag the payment say by a month (or a year). Meaning you get paid on sales from last year or month. Yes to be fair this would mean you go without payment until later. At least once your done you will get paid for not working. In other words, it will come back. Or what I would like to see is this "profit" be used to help the greater good. Not saying there will not be taxes but to go beyond the social programs we have now. Let me be clear though, this is all just my opinion. This is not the only ways of handling this. How do you think this should be solved?

Really people? Somehow this came to a discussion on what the governments are doing about an alien attack. Seriously? WTF? I know there are a few people here who can see the monitary system we use is corrupt. I don't think we need to convince people of this as it will become apparent in the future. Many people just cannot accept that this needs to change. One day they will not only want it to change but will even fight for that change. The question is what needs to change and how. I already stated what I found to be a better system. Probaly missed by most reading this as there is a lot of off topic discussions on this forum. I think money should be created through labour and then at the point of sale, be returned to the "bank". At the cost of the labour involved to turning this into a finished good or service. This would create a circulatory system. I know this would raise a lot of questions and there are answers. We already have business down to a mathimatical science using accounting. I just think it's time we use what he have already learned and make things better for humanity.

Ok a couple posts back I meant 1=1+A not 1+1A. Sorry for the typo. I think even M.Dancer is starting to get it. Except that taxes and bonds are all means of extanging money and not creating it. Think about it, if you never created the money how and people pay for taxes? How would Canada pay for the bonds to which it's earning its currancy? At the point money becomes available to the private and public sectors, it is loaned to them (All of it). This is where the equation 1=1+A comes from. From there you can make the system as confusing as you would like but this will always ensure the bank is owed more money then what actually exist. Michael Hardner, money is circulated and can be used in a savings account to gain interest. This is because it is just being loaned out again. While the money is in your savings account, someone is getting deeper in debt. The problem with this system is recessions and depressions. I'm not saying everyone in this system is in debt. By using this system, it is only a matter of time before another great depression hits. Some believe it will make the dirty thirties look like easy times. This is why it needs to change.

Good to see that someone gets it out there. Again people do not be fooled by the extange if money through circulation this system is not perfect. What you gain is somebody else's loss. When a company is making billions of dollars other companies are losing just as much. Then you throw interest into the mix and you have an unbalanced equation. A mathimatical impossiblility is created. Meaning $1 = $1+interest or 1=1A. Unless a=0, this is impossible.

Again you all strayed from the original intent of this post. I do not care how other countries use their monitary system. Frankly it could afftect me less. I don't care how investments or stocks work. I don't care where your paycheck came from. All I care about is the creation of money and how that gets to the general public. If money is not CREATED through debt, tell me where it comes into circulation from. Look for yourself. It's not a conspiricy because this is how the system works. Resessions and depressions are a by-product of this system. In my opinion this system needs to change.

Money does not come from lots of places......Investors do not create money.....Companies do not create money. And so on does not create money. My logic comes from tracing it back. Think about it for a second. All money originally comes from banks. These banks circulate it using loans. Meaning all money in circulation is givin using the formula 1=1+A. Does that formula look correct or incorrect? Is there a flaw with the logic that I am using? If so explain how.

First year eh? So money is created by the banks. Then I give them my money? You missed a step Cybercoma. How the money got from the banks to me to deposit it.....And Michale Hardner that was like asking "If your so smart, why don't I understand you?". Sorry to get rude but I really don't want to repeat myself. One more time for the slow people.....Every legal tender (or bank note) in Canada comes from a Bank. The Bank then loans the money to people and business. Then the money is extanged through regular transactions. Because the money comes available to public on loan, interest is applied. The money to pay interest does not exist as every dollar outside the bank's assets or reserve was borrowed. FOr the last time....this is not a conspiricy. I am just stating how a system I myself have studied works. You people are getting confused with how money is extanged rather than the simple process of its origin. At this point is where the system is flawed. Why not fix it? Look I really do not care if your scared or confused by how things work, don't waste my time on trying to explain it. If your not going to believe me anyways, look it up. Get educated. Then defend the current monitary system with hard facts. I look outside and feel safe in it's blanket as well. I mean things are good on my suburban street. That doesn't mean we cannot create and use a better system.

I wasn't really talking about the extange of money. It's the source I'm interested in. No matter what, that source is our central bank (The Bank Of Canada). With the extange of of money you can repay your loan but that makes it impossible for another person or business to pay off theirs. It's simple math/accounting really. Yes banks have the power to manipulate the economy and this is not a good thing as recessions and depressions don't just happen. The system I suggested would not cause massive inflation because when you spend your money that would go back to the "bank" as you are trading your money for the good or service. Everyone working for the good or service you purchase would have already been paid for it. This is a circulatory system. Inflation would not exist. Taxation and the laws of supply and demand would still exist yes but inflation is not a byproduct of this system. There are a number of ways to make this system work. I could tell you my opinion on how I think it should work but there would still be a need for democracy as everyone would have their own. If you read up on the laws of commerce; Money is a measurement of energy. Energy meaning effort. Sorry if this post seems fragmented but I'm debating against a bunch of posts.

Where do you think the source of the money you were paid is from?

Even though you are not borrowing money yourself you are earning borrowed money. IF money is created through labour, you give it back at the point of sale creating a fair circulatory system. If money is supposed to be a measurement of energy the system we currently use does not make any sense at all. I'm just going to start repeating myself here if I keep going. You have the information now instead of defending a flawed system would it hurt to think of alternatives?