It’s lovely worth enough for me. In my opinion, if all webmasters
and bloggers made excellent content as you did,
the web can be a lot more helpful than ever before.

"Capitalism without bankruptcy is like Christianity without God or Jesus".

Listen to the full interview here:

http://www.bbc.co.uk/iplayer/console/b0124qtk (NB: just before 27mins in).

definitely agree that honest money would be an important first step, as the current system seems like bread & circuses – I would love to see a more centrist public figure than those currently doing it, expose these ideas to a wider audience, but in the mean time, thank you so much for your taking the time to educate the economically illiterate life myself.

I can see where you're both coming from, fascinating stuff thank you.

In actual fact, there is not perfect system. Any system can be gamed. The demise of the Romans was heralded by a "need" to debase their gold based currency because state expenditure eventually overtook fiscal income as empire building guarantees will happen.

That does not detract from the fact that DBFM is a deliberate tool for the impoverishment of society from the word go. Not only that, but DBFM allows degrees of leverage that are significantly higher and, crucially, stealthy till the moment the whole house of cards comes crashing to earth.

A value based monetary system or a fiat monetary system based on a fixed quantity of money can be gamed. All it takes is poliical will. But either of these two systems make it much harder and evident that the system is being gamed.

Just like Democracy is the worse system of government except all the others that have been tried, honest money too is the worst monetary system except all the others that have been tried.

Are we fighting wind mills? It certainly looks and feels like it. It comes down to cycles I suppose. Most people have been happy to run in their hamster wheels till today. But suddenly, all the wealth that has been subtly stolen over the decades now seems to matter. The problem is that the math behind the system has not changed. It has always been there for all to see. Why did it not matter then but it does now? Heck if I know. But the piper is aknocking and someone is expected to pay.

But while I can see the harm caused by DBFM, I'm not so clear about its absence being enough to protect against exploitation.
Was there ever a time when the economy operated with a non-debt based currency and industry has neither slavery nor its successor indentured servitude to rely on?
My worry with cancelling DBFM, is that, in the absence of wiping the slate clean and starting again (although global financial collapse might partly achieve that I suppose), we would return to an era where the landed 'gentry' would control economic activity. Because while agree that personal debt is not a good thing – doesn't bank credit facilitate entrepeneurship and upward mobility? I mean I know that there cold still be banks and loans but they'd be vastly reduced, and wouldn't that concentrate the economic control in the hands of the wealthy/the banks who would favour safe (large) corporate investments over the new little guy on the block? And in the absence of inflation wouldn't there be little incentive to take any investment risks at all – why wouldn't those with an abundance of cash just sit on their money, or invest it in those things which suit their narrow interests?

If the main players remain largely the same and you also got rid of labour standards and the minimum wage then wouldn't they be free to exploit those without land or resources to their hearts content. And couldn't we still be left in the same position where we are today – where a disproportionate amount of the world's resources go towards a kaleidescope of amusement for the world's rich, at the expense of even basic goods for many people in the world?

I could be missing some very obvious point here but it seems to me that DBFM has allowed TBTP to put off a basic confrontation between an evolving public morality (which renounced, aristocracy, slavery, indentured servitude, and then the idea of a subservient and pliable working class) and the hierarchical status quo of inherited wealth and privilege (won a the point of a gun/sword, whether recently on some new frontier or in the old world many moons ago) and the newer rentier class (whose wealth might have been wiped out if the GFC was allowed to correct itself.

I agree, that to get back to honest money as you call it would definitely be a start, but I thing that avoided confrontation remains to be had. Or you could say that's where we're at right now, DBFM or no.

Sorry that's probably a bit muddled and if someone helpful and more literate! wants to make any of it a bit clearer please do so.

Efficiency as a universal concept, has nothing to do with making someone work 20 hours and paying them a pittance. Or, at the very least, that is a very selective application of the concept of efficiency.

As upheld in the philosophy of Tao, efficiency applies to everything, everywhere at any given time, universally. Dignity is a direct function of efficiency. The freedom to work as much or as little as one desires in order to achieve their own stated goals is a function of efficiency. But government coming to tell me how much I should work goes against freedom and efficiency. Similarly, government saying what someone should be paid for a given task goes against efficiency.

But, I hear you retort, the minimum wage guarantees dignity for anyone taking a job.

When you think of the minimum wage, you cannot think of it in isolation to the entirety of the economic framework government has put in place due to the requirements of the monetary authority that requires instituting ever more layers of mandated spending in order to induce circulation of the currency. Like social security, the minimum wage has the veneer of decency and humanity but in fact, it does not stand up to rational inquiry because anyone that can perform basic arithmetic has been warning that social security as it was set up could never work. More precisely, just like in a pyramid scheme, social security as it was instituted would work for the people that first got into the scheme but for those getting into the scheme at later stages.

In the absence of an interventionist, inflationist state, a minimum wage has no reason of being. In the absence of the need for inflation, government would be left to deal with issues pertaining to decency and the impartial application of the law.

It is the need for inflation that leads to aberrant, exploitative, wasteful policies.

There is little we can do about human nature other than set rules and enforce them. But there is a whole lot we can do about the nature of money.

Make money honest and a swathe of problems relating to decency and exploitation will take care of themselves.

DBFM must inherently, inevitably and necessarily corrupt government. It mathematically cannot be otherwise.

Because of its mathematical characteristics, inflation is limited; it is finite within a given system. In other words, in any given monetary system, government cannot push inflation ad infinitum.

Hence, an inflationary monetary system as DBFM is, must necessarily assimilate other monetary systems and markets for its survival. This is what the concept of "Floating Exchange Rates" does. It Dollarizes the sovereign currencies of the participating countries. This is the reason why when bankruptcy stokes banks in Europe, the Federal Reserve opens swap lines.

Inflation initially crops up fairly evenly across the economy inducing a general rise in prices and wages (i.e. 70s). Eventually, as new members to the monetary system are assimilated, corporations will seek to outsource jobs to those markets where inflation has not yet had the same degree of incidence that it has had at home. In turn, this wage arbitrage serves to simultaneously limit wage growth and expand credit markets at home. This is the monetary authority's wet dream.

From there, you have all sorts of exploitation going on including the use of illegal labor at home.

But hold on. Let me go over inflation because it is important and is the basis of all the oppression you refer to.

Inflation conforms to the law of diminishing marginal utility. This means you always need more inflation to achieve the same result. This is borne out by empirical evidence such as US Federal debt increasing by over 1000% but GDP increasing only by 100% since 1980. That's the plainest illustration of inflation.

One of the results of inflation is that it compresses in time the demand and production cycles. This is exactly one of the intended aims of inflation. By debasing the currency, government induces spending in order to induce circulation of the currency. In this construct economic actors consume today what they would otherwise consume over a much longer period of time. For example. In the absence of credit, you would have to save your excess income before you could buy a car or a house. But when credit is made available cheaply and pervasively, you can buy today both your house and your car.

Now. When you induce inflation aggressively over decades, you are inducing excess consumption. Thus, for example, you also instigate the depletion of natural resources because you don't allow the natural cycle to replenish those resources. Think of fish stocks today that are thoroughly depleted in the coastal waters of the West. Think of aquifers. Think also of oil wells where extraction rates are directly related to the productive life span of each well.

So, inflation is directly related to dynamics that are aberrant, immoral, expedient thus inherently wasteful.

How do you judge the desired level of efficiency ? Is it desirable at any cost ? From the definition it seems to imply that the more efficient the better, but surely nearly everything must be only relatively efficient.

My little production line I feel is quite efficient, but myself who operates it, being a middle aged spoilt Western male who is often distracted, am not as efficient as say a 16 year old slave girl.

So if I was able to smuggle my slave girl into my lttle factory, my factory would be more efficient, but would this outcome be desirable.

The very definition of efficiency means it can be forever & ever squeezed to get more out of something. Therefore to produce something with the tiniest effort possible is it's goal. A good thing in energy terms but perhaps not in Human ones.

If due to austerity measures in a country a boss needed to increase his factories productivity by forcing his workforce to work faster, with longer hours & by lowering their wages, he would have succeeded in making these people more efficient, but I am sure their pace of life would have quickened.

I agree efficiency is a very good thing, but once you add the Human element it can be used for both good & bad ends.