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Post by eclipse on Feb 5, 2016 11:40:59 GMT 9.5
Hi all, one of the themes in environmental discussion is that our banking system creates a growth imperative or the whole thing collapses. That is, because new money is constantly created as commercial banks loan money into existence, new GDP and jobs and services must continue to appear and the whole economy grow or the new loans will not be repaid. They're loaning money into existence based on the assumption that the economy will grow to pay back the debt: one of the many reasons why the GDP must always grow. Are there any faults in this argument? If not, what do you think the solution to a 'stable state' economy might be? What do you make of Switzerland's referendum letting the people decide whether banks can create money? www.independent.co.uk/news/business/news/swiss-referendum-to-decide-whether-its-banks-can-create-money-a6789061.html
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Post by Greg Simpson on Feb 6, 2016 10:52:33 GMT 9.5
I think it's only a minor problem. Negative interest rates are one solution.
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Post by eclipse on Feb 6, 2016 12:50:46 GMT 9.5
How would that work? And can commercial banks actually create money out of thin air by loaning it into existence? How do they actually do that, and how do governments count how much money is actually in the economy in that case?
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