Government['s] .. privilege [of] .. fractional reserve banking .. a fraudulent business practice.'
Posted by ProjectC
..real economic activity has been weakened so much that it can no longer support the mountain of unsound debt.'
<blockquote>'The remarks we have highlighted above are of course points we have made for many months. The banking solvency crisis and the sovereign bond crisis are closely interlinked. Governments have accorded banks the privilege of fractional reserve banking with the explicit aim of profiting from what is essentially a fraudulent business practice. The vast expansion of the State witnessed in the 20<sup>th</sup> century would have been impossible without it. However, the clever boys who came up with this scheme overlooked an essential point: namely that it is not possible to suspend economic laws. The bigger the credit expansion became, the more capital consumption it engendered. There is a limit to how far the Potemkin village of false prosperity created by the expansion of the credit and money supply ex nihilo can be taken. At some point a threshold is inevitably crossed, when real economic activity has been weakened so much that it can no longer support the mountain of unsound debt.
In light of this, all the plans to further expand the ECB's monetary pumping measures can only delay the inevitable end game and make it even worse. There will be jubilation in the current economic mainstream once the ECB deploys the full force of its printing press, but this only confirms the extent to which the economics profession has become little more than a handmaiden for the statism that the current financial system provides the basis for. The belief that systemic insolvency can be repaired with the printing press is sorely mistaken. There may be short term relief, we don't deny that – but at the price of an even bigger crisis down the road.'
– Acting Man, The ECB and ‘Balance Sheet Recessions’, December 2nd, 2011 </blockquote>
Context
<blockquote>'..a dagger in the heart of The Mythological Great Moderation.'
'..present violation of law..' - Otmar Issing
'The use of GNP .. exaggerating the importance of consumption in the economy..'
'..The world doesn't have too little debt, but too much..'
'.."financial slavery" that grips the world .. are of high human and personal cost..'</blockquote>
<center>Global Debt
</center>
<blockquote>'The remarks we have highlighted above are of course points we have made for many months. The banking solvency crisis and the sovereign bond crisis are closely interlinked. Governments have accorded banks the privilege of fractional reserve banking with the explicit aim of profiting from what is essentially a fraudulent business practice. The vast expansion of the State witnessed in the 20<sup>th</sup> century would have been impossible without it. However, the clever boys who came up with this scheme overlooked an essential point: namely that it is not possible to suspend economic laws. The bigger the credit expansion became, the more capital consumption it engendered. There is a limit to how far the Potemkin village of false prosperity created by the expansion of the credit and money supply ex nihilo can be taken. At some point a threshold is inevitably crossed, when real economic activity has been weakened so much that it can no longer support the mountain of unsound debt.
In light of this, all the plans to further expand the ECB's monetary pumping measures can only delay the inevitable end game and make it even worse. There will be jubilation in the current economic mainstream once the ECB deploys the full force of its printing press, but this only confirms the extent to which the economics profession has become little more than a handmaiden for the statism that the current financial system provides the basis for. The belief that systemic insolvency can be repaired with the printing press is sorely mistaken. There may be short term relief, we don't deny that – but at the price of an even bigger crisis down the road.'
– Acting Man, The ECB and ‘Balance Sheet Recessions’, December 2nd, 2011 </blockquote>
Context
<blockquote>'..a dagger in the heart of The Mythological Great Moderation.'
'..present violation of law..' - Otmar Issing
'The use of GNP .. exaggerating the importance of consumption in the economy..'
'..The world doesn't have too little debt, but too much..'
'.."financial slavery" that grips the world .. are of high human and personal cost..'</blockquote>
<center>Global Debt
</center>