Thoughts on money creation

[Nilotic]

I created this thread to gauge how many people actually know where the vast majority of the money supply comes from, so I'm asking people to offer their theories.

 

[Basra]

 

[Nilotic]

View attachment 206014

Do you like the picture?

 

[Basra]

Do you like the picture?

Yes. I think it is very energetic, powerful, and also surprisingly alluring

 

[Nilotic]

Yes. I think it is very energetic, powerful, and also surprisingly alluring

 

[Nilotic]

Richard Werner basically lays out that:


-Banks create money (credit) out of nothing and it's to the tune of 97% of the National money supply
-Banks do not lend money; they issue securities
-Nations do not need to borrow money from international creditors and institutions
-Bank window guidance facilitates economic growth without inflation and crisis

 

[Ahmed Ato]

I only think it is a problem when the government does by printing cash.
the one with banks don't cause that much problem since they are private companies who care about their bottomline and won't just do things carelessly like the government.

 

[Nilotic]

I only think it is a problem when the government does by printing cash.
the one with banks don't cause that much problem since they are private companies who care about their bottomline and won't just do things carelessly like the government.

It wouldn't be an issue as long as the Government used the money for GDP growth instead of asset bubbles.

The Japanese and the Germans controlled credit creation, so Government can and does serve a necessary and positive role in economic growth; banks create 97% of the money supply and so we need to mandate credit window guidance.

 

[Nilotic]

@Apollo @Shimbiris @Periplus @alexander @Hot Ballah @World

 

[Boqorada]

Whenever this is discussed I always see people asking why the government doesn't just print more money so poverty would magically cease to exist lol.


It's a cute kindergarten idea but

 

[Nilotic]

Whenever this is discussed I always see people asking why the government doesn't just print more money so poverty would magically cease to exist lol.


It's a cute kindergarten idea but

View attachment 206174

Money or credit should only ever be created to spur productive forces in the economy, otherwise it would be inflationary and counter-productive.

Credit creation should be restricted to production and steered away from consumption and asset bubbles -- as was done in Japan for decades. Banks should serve a tertiary, non-profit role in the economy.

African Nations should only borrow money from international creditors to establish:

Steelworks
Aluminium mills
Cement factories
Refineries
Chemical plants
Fertilizer plants

The Nation's banking sector can then create loans for infrastructure projects instead of borrowing money for every highway and railway project.

 

[Nilotic]

The documentary above is very enlightening, so give it a watch when you can.


The implications for all of this is clear... African Nations do not need to be reliant on external sources of credit creation -- especially once they build the plants I listed.

South Sudan could have established these plants during and after the Interim Period; close to $20 billion dollars were stolen, and these funds would have been enough to establish all those facilities...

.Establishing a range of small, medium and large non-profit banks should have been the next measure; we should have then created tertiary institutions to train thousands of engineers and other technical experts...

.. Middle and upper management leaders should have been trained and appointed to manage infrastructure Authorities in the Nation; and international experts and consultants should have been employed to train us on how to operate and maintain all these critical pieces of infrastructure.

I genuinely wouldn't be surprised if African banks were making use of the intermediary form of banking in light of how depressed our economies are.

 

[reer]

I genuinely wouldn't be surprised if African banks were making use of the intermediary form of banking in light of how depressed our economies are.

saying africans are baboons but in a diplomatic way. i completely agree.

 

[Nilotic]

saying africans are baboons but in a diplomatic way. i completely agree.

 

[Nilotic]

Local banks in Germany


Germany has an extensive local bank infrastructure:

The Sparkassen are a group of savings banks that have been operating across Germany since the first one was established in Hamburg in 1778. They were born of the need to invest in the country and in German society, and they maintain close ties to local communities. Banks are located all around the country and they are managed by an umbrella organisation Deutscher Sparkassen- & Giroverband (DSGV). They are established by law with a mandate of public service and regional development, and their success is measured based on their impact on local communities rather than on traditional economic requirements.

"The Sparkassen are most notable for the public welfare mandate they have, whereby stakeholder value is the key objective not shareholder value. The Sparkassen have the lion's share of the market for SME financing in Germany at 70% with an overall 42% market share of business financing generally. As of 2014, the 423 Sparkassen had 15,300 branch offices with 245,000 staff and a business volume of €1,106 billion."[8]

https://www.centreforpublicimpact.org/case-study/sparkassen-savings-banks-germany

 

[Nilotic]

I would really like to get input from the rest of the forum.

 

[NordicSomali]

I would really like to get input from the rest of the forum.

The money supply is a very interesting topic, I will tell you more soon

 

[Abdisamad]

I would really like to get input from the rest of the forum.

I don't know much about the financial world..

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[NordicSomali]

I would really like to get input from the rest of the forum.

 

[NordicSomali]

@Nilotic theres also something called seignorage which is the real value that US government extracts from the world by printing dollars, estimated to be 20 billion usd pr year according to Krugman. Basically means the US government steals 20 billion from the world by just printing money.