QE for geeks

A while back there was discussion of QE in Critical Thinking, its rationale, effect and speculation on where it's taking us. The Quantity Theory of Credit was presented in April 1993, at the RES Annual Conference at York by Richard Werner, now professor of international banking at Southampton University. Here he explains the distinction between credit which drives GDP and credit which drives asset prices and the power of the short side.

Quantitative Easing and the Quantity Theory of Credit by Richard Werner
While the effects of QE continue to be debated, Richard Werner1 explains the origin of the term (and some misconceptions surrounding it).

The power to control money grants control over everything else, which is why understanding the process and effect of money creation is so important. Those that control global banking, control the world and only by taking away their power can we solve the problems in the world. That power is derived from, and exercised through, economic flaws: control of the commons (including land and resources) denying the rest of us access to the means to life; and the alchemy of interest on money. Once people understand the importance of money, the impetus to take away control of money from Rothschilds et al will be unstoppable.

Comments   

 
0 #3 James Walter 2016-05-25 04:42
The point of my opening comment is that banks don't loan money EVER in order to stimulate the economy so all the math and symbolism is meaningless
 
 
0 #2 Clive Menzies 2016-05-24 22:08
Quoting James Walter:
Richard Werner's article is bunk, meaningless gobbledygook. Development of resources and increasing productivity are how you create wealth


"We have met the enemy and he is us" - Pogo


Hi Jimmy, Your opening statement is harsh but I know what you're driving at. The article is written in the context of the existing paradigm which is the source of the problem.

I agree with almost everything else you say. Yes it was sarcasm in the sense that in today's paradigm, time is money but it shouldn't be.

And yes we are our own enemy because it is our ignorance which keeps us captive. Once sufficient numbers know this, the chains will fall.
 
 
0 #1 James Walter 2016-05-24 15:04
Richard Werner's article is bunk, meaningless gobbledygook. Development of resources and increasing productivity are how you create wealth

While I agree totally with your comments about bankers control, I agree in the choking, negative sense, not the creative sense. Money does not create wealth. It can allow wealth creation. You probably meant that, but I want to emphasize it.

You touched on a similar part " the commons (including land and resources)". They do not create wealth either, but their development for human use does. So again those that control it can choke off and prevent wealth, but not create it.

I read your "alchemy of interest" and while good, it fails to mention the choking effect of interest that must be paid back Plus the loan: the bankers create all the money and want more back than they created. Dick Eastman is good on this point. Where I differ with you, is that "everyone knows that time is money" (or perhaps you were being sarcastic)


Wealth is not money, but it controls wealth. Money is a medium of exchange. It should represent the relative value of the present assets and future assets that will be produced by the means of production and the development of land and resources.

Moreover, it should be used to allocate labor, land, and resources for the public good. Those people that do so well, should be rewarded with increased personal consumption and, if they want it and can handle it, more assets to develop and more labor to direct.

But what about free time and how we use it? The drug industry, i.e. entertainment industry (including pro sports and porno), alcohol, sugar, caffeine, chocolate, illegal drugs, etc., have caused massive health and psychological problems. Yet they are considered wealth and highly desired by the population. If put to the vote, they would not suffer.

We can all agree that the war industry is a cancer. Yet the propaganda industry (schools, the news, movies, memorial days, love of country) has little trouble getting people to support it.

So even it we wrest control from the Banksters, how do we get people to realize and support what real wealth is? I have no good answer. Of course, we must control the media. But it seems that only through a meritocracy, not democracy, is that possible. The only meritocracy, the Chinese, have given into all of the flaws I point out above so even that seems hopeless.

"We have met the enemy and he is us" - Pogo
 

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