Welcome to European Tribune. It's gone a bit quiet around here these days, but it's still going.
With bank lending, the effect is temporary, as the loan is paid back, and money destroyed then.
That is the cincher. I believe Chris recently posted alink to a film makign the following claims:
  • money is created by loaning and destroyed by repayment
  • therefore: no debt => no money
  • but, in addition, in order to repay the loan with interest, more money needs to be in circulation at any given time than existed previously, or failing that a fraction of the loans need to be defaulted on
  • therefore, the total amount of debt must continually increase, or there must be a continual stream of defaults in your "steady state"

Bush is a symptom, not the disease.
by Carrie (migeru at eurotrib dot com) on Fri May 11th, 2007 at 08:27:56 AM EST
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