Scottish Independence

United we stand ...

Divided we fall ...

 

Keep the Kingdom United ..for James 6th!

The real deficit is in thinking

Solving the UK's economic problems should be like solving most crimes.  You follow the money!

If you are interested in learning more about a solution [which has worked before] then please visit this website:  www.positivemoney.org  [Link opens in new window]

Full reserve banking please

Please sign this petition which is for the G8 meeting 17-18 June 2013
End the debt based money system [petition]
[Link opens in new window]

Do you believe that the high street banks have the right to create money?

I had a meeting with Martin Horwood MP in November 2012 to ask the question, 
"Do you believe that the high street banks have the right to create money"?  Neither he nor his team were able to answer this question, except to explain the legal basis for notes and coins i.e. for 3% of the money supply.  I then recieved the following letter from Rt Hon Greg Clark MP.

 

This is my response to this letter:

Thank you for the copy of the letter dated 30 January 2013 from Rt Hon Gregg Clark MP to you, in response to my question:

“Do you believe that the high street banks have the right to create money?”

I broadly understand the economic theory of Fractional Reserve Banking. But I have also have seen its real and catastrophic failure, as demonstrated at Northern Rock and indeed throughout the banking sector from 2007/2008 to the present day.

Further, I note the quote from the Independent Banking Commission’s interim report.  This remains just an opinion, as the Commission have been unable to provide their economic modelling to substantiate this statement, as requested by Positive Money.  

The “benefit” of Fractional Reserve Banking, is where I fundamentally disagree with Mr Clark.  A basic understanding of the reasons behind the Bank Charter Act of 1844, will lead to an entirely different conclusion.  In addition, it is a generally accepted view that the unrestrained lending capacity of the banks was what caused the current and continuing crisis, in the first place.

Sir Mervyn King, Governor of the Bank of England said on 19^th October 2010:

“The Bank of England’s key role has always been to ensure that the economy is supplied with the right quantity of money – neither too little nor too much.  For fifty years my predecessors struggled to prevent there being too much, so leading to inflation.  I find myself in the opposite situation having to explain that there is too little money in the economy.”

The Austerity policies of the Government are inevitably reducing the amount of money in the Economy, the exact opposite of what is, according to the Governor of the Bank of England, required right now.

The statement in the fifth paragraph, “the current system does not permit the uncontrolled expansion of the money supply”, is demonstrably untrue.  I attach a graph which shows the money supply [M4] from 1963 to 2011 [Source: Positive Money/Bank of England].  Ben Dyson, Director of Positive Money, said in his opening statement of the 2013 Conference:

“This [see attached graph] does not look like a money supply that has been controlled … this is something that is out of control”.

In fact, an almost identical letter to the one from the Rt Hon Gregg Clark is in Ben Dyson’s opening statement to Positive Money’s Conference 2013.  Ben Dyson explains the problems with this “copy and paste” response from The Treasury.

I would strongly recommend that you start talking to Positive Money, the New Economics Foundation and the few MPs who understand their research, like:

Michael Meacher MP

Steve Baker MP

This YouTube video is a good introduction to Positive Money’s research: http://www.youtube.com/watch?v=Rd9Pf3Bqp20 . 

[Link opens in new window]

The current banking system was not designed and so, like in the 1840s, this is a great opportunity to analyse and understand what has gone wrong, rather than attempting to fix something that is fundamentally flawed.  Banking reform remains necessary because the system is still at its very heart, broken.  In addition, austerity policies are a choice which is entirely unnecessary, it’s not like there is nothing to do.

Unfortunately, the Government seems intent on trying to get the banks back to ‘business as usual’, rather than to act on the fundamental problem that caused the crash in the first place.  The banks changed from making money for their customers, to making money from their customers.

Lastly, I am again disappointed that my question was not actually answered.  Is it really acceptable to have no legal basis for 97% of our money supply?

Yours Sincerely

I confidently predict that the "deficit in thinking" will remain firmly in place and the destruction of this great nation of ours, at the hands of the Government, will continue apace.

Positive Money - Banks are not financial intermediaries

"Banks are special, because they can create new money ‘out of nothing’ = credit creation."

 http://www.positivemoney.org/2012/06/how-to-make-banks-socially-useful-video/
[Link opens in new window] 
Source: Positive Money - Facebook - 29 March 2013

Thanks guys!

It's my birthday!  Thanks guys, you shouldn't have!

Facebook Irritations - Failed upload of JPG

So there's this JPG file that I want to upload to my Facebook page.  But it will not upload.  I try converting it to a GIF.  But it will not upload.  I try taking a screen shot of the file as sharing seems to be blocked, to create a new JPG.  But it will not upload.  I try all versions of the file in IE8, Firefox and Chrome.  But they will not upload.  This has happened a few times before even with unedited photos I have taken.  Why?  Anyway I'm going to try and upload the file to this blog.

Just follow the money

How long will it take for these stupid people to 'get it'?  Solving the Economic Crisis should be like solving a crime, just follow the money.

Industrial output dropped sharply in January and it looks like we are heading for a third recession.  I think that it is pretty clear that the last 5/6 years has been one big recession.
Pound falls on weak manufacturing data 
[Link opens in new window]

So let's go over 'The Rules' again.
More money = more debt
Less debt = less money

For enlightenment visit
Positive Money  
[Link opens in new window] 

When money drives most of the activity on the planet, it's essential that we understand it.
Positive Money believes that the root cause of many of our current social, economic and environmental problems lies in the way that we allow money to be created. We work to make the confusing world of money and banking much easier to understand.

The good news and the bad news

[All links open in new windows]
 
Lets start with the rules.

Here is the evidence of less debt in the Economy.

There was an £11.4bn surplus to the Deficit in January 2013 [this helps to reduce the National Debt or rather slow its rate of increase].

BBC News - UK public finances show January surplus  

Here is the evidence of less money in the Economy.

The Government’s £70bn “Funding for Lending” appears to be not working as bank lending fell by £2.4bn in February 2013.

BBC News - Banks reduce loans, in spite of Funding for Lending

The Office for National statistics originally said that 2012 showed no growth at all.  However they have revised their figures up to 0.2% growth but the last quarter of 2012 showed a contraction of 0.3%.

BBC News - GDP: UK economy grew more than thought in 2012

Axminster Carpets have gone into administration. 

BBC News - Axminster Carpets redundancies: Staff offered help

Thomas Cook are making 2,500 staff redundant.

BBC News - Thomas Cook to cut 2,500 jobs in UK 

According to the Payment Council 58p in every pound is now spent in supermarkets, accelerating the move away from the High Street.

Convenience Store - Payment revolution must not be ignored, retailers warned

[My own thoughts on this is:

Option A – Supermarket with FREE car park and except an actual space.

Option B – The High Street with quite often no car parking space and so a wasted journey or it costs a fortune to park.

Don’t the Local Authorities get it?  The car was invented over 100 years ago.  It’s about time the car was catered for …Oh wait!  It already is, at supermarkets.  Duh!]

28 shops a day are closing; 10 more than last year.  Does this ostrich like Government not notice?

BBC News - High Street retailers: Who has been hit hardest?  

Gas bills have nearly doubled in 6 years according to Consumer Focus.

BBC News - British Gas profits boosted by colder weather

[Can’t find the exact news story but there are so many about the subject of Fuel Poverty]

And back in 2006 … doubled …

BBC News - High fuel bills panel  

There has been a sharp fall in the Purchasing Managers Index because of Euro zone recession.

BBC News - Eurozone recession deepened at end of 2012

Lloyds bank report losses of £570m mainly because of Payment Protection Insurance mis-selling.

BBC News - Lloyds bank losses narrow to £570m for 2012 

So, the same problems across the pond.

Detroit USA has a $300m deficit.

There was a story on Radio 4 last month about Detroit but this is a 2009 news story.  But then I found this from 4 years ago.  I think it was Detroit where you could buy a pretty substantial detached house for $1 back in 2008.

Guardian - News World news United States How Detroit, the Motor City, turned into a ghost town