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posted by LaminatorX on Tuesday March 25 2014, @03:25AM   Printer-friendly

Anonymous Coward writes:

"http://www.theguardian.com/commentisfree/2014/mar/ 18/truth-money-iou-bank-of-england-austerity

Back in the 1930s, Henry Ford is supposed to have remarked that it was a good thing that most Americans didn't know how banking really works, because if they did, 'there'd be a revolution before tomorrow morning.'

Last week, something remarkable happened. The Bank of England let the cat out of the bag. In a paper called "Money Creation in the Modern Economy", co-authored by three economists from the Bank's Monetary Analysis Directorate, they stated outright that most common assumptions of how banking works are simply wrong, and that the kind of populist, heterodox positions more ordinarily associated with groups such as Occupy Wall Street are correct. In doing so, they have effectively thrown the entire theoretical basis for austerity out of the window."

 
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  • (Score: 1) by khallow on Thursday March 27 2014, @11:24AM

    by khallow (3766) Subscriber Badge on Thursday March 27 2014, @11:24AM (#21990) Journal

    When markets collapse, when your whole monetary system collapses, the money vanishes into thin air.

    Yes, I'm aware of how it works because this sort of collapse has happened before (for example, hyperinflation). But in modern times, it hasn't been hard to reestablish a currency and markets again after the collapse. One merely needs to look at real world examples to see that you haven't thought this through.

    And MARKETING != markets. You conflate two unrelated concepts.