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PostPosted: Sun Jan 20, 2019 9:37 am 
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I've probably wittered on about this before but....

If anyone has any idea of how the banking system works can they put some input on the idea below???

You might be aware that banks control the money flow and rob us all by way of their interest rates and ability to 'fabricate' money from thin air (fractional lending) - there's also concern that the current way of using 'cash' is headed for history on the back of a global financial meltdown.

The recent rise of digital currencies may offer a way out of this situation - is this perhaps why banks are so set against their use and (again, perhaps) why these digital currencies are so currently (deliberately made) volatile?

If a country ditched their current fiat currency and issued a digital currency linked to GDP then they have the assurance that (a) the currency is limited in availability (like gold is) therefore immune from interest depreciation and (b) appreciates in a trading form as the countries GDP improves (or not) and (c) the people of the country have a vested interest in making their GDP improve and (d) debt could be issued interest-free (or at a minimal rate) safe from deflation due to money printing off the back of it.... etc. There may be other incentives for doing this, there may equally be problems. Dunno.

Either way the idea is to take banks and their currency manipulation out of the system, lock 'money' to productivity, prevent fraudulent creation (and counterfeiting) and give control of economies back to those that actually make it - us.

By individual countries adopting this method they get control of their own currency, remove the control banks have over their policies, create incentive for the workers and prevent depreciation/interest rates ruining peoples lives.

Ideas?

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PostPosted: Sun Jan 20, 2019 8:20 pm 
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Countries already have control on their currencies.

Modern day currency is all about confidence in that currency. Demand = confidence.

The USA make things the world wants (think tech, arms, cars) and they use USD. Add long as people want their stuff they need USD, and confidence is high in the currency. People want oil, oil is traded in USD, that also keeps the currency strong.

Once there is no confidence in a currency, because there is no confidence in the stuff that trades in that currency, it devalues.

Countries control currency by 'buying' and 'selling' their own currency for supply and demand control. But that effect is always limited.

Bitcoin, GBP, monopoly money - none of it matters. It's all about the confidence.

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PostPosted: Sun Jan 20, 2019 8:21 pm 
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Interest and inflation is another subject to currency altogether...


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PostPosted: Sun Jan 20, 2019 8:41 pm 
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i dont particularly like cryto curency but for no other reason than i am risk averse and even if they are a good eventual choice they are quite volatile

in a situation where we trade with the word we need an easy system that permits easy trade the more layers and the more complicated it is both restricts who you can do business with and incurs more cost

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PostPosted: Sun Jan 20, 2019 9:26 pm 
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There's a difference between 'made-up' digital currencies and one backed by a country/government/population. It is partly the 'confidence' that such currency requires to make it workable as sammy.se suggests.

But whereas a countries fiat currency can be devalued by external influences - i.e. holders of fiat currencies (banks, governments, large corporations etc) can dictate the value by buying/selling - such could not happen with a digital one tied to GDP unless those that held it could influence GDP in some way (virtually impossible). Countries have net 'worth' and that worth divided by the number of digital 'coins' that can be created by a given algorithm set the value of each coin and the only way to change that value is to change the 'worth' of the country. Those that create the worth are paid for their efforts and payment in the digital currency tied to GDP would be free from manipulation and interest (effectively) only rising and falling with the efficiency (or otherwise) of those that create it. Tying the workers to the currency gives THEM the ability to control it.

This failure of fiat is illustrated by bank/government implementation of QE as but one example - where they print (fiat) money to cover their debts and thus devalue every other 'coin' of that currency. You can't print more digital coins as they simply can't be brought into existence - all you can do is vary the worth of those that already DO exist so back to the point I made above.

Of all fiat currencies currently in existence NONE are free from manipulation, deflation, interest charges etc and the BANKS are in control. They lend (create) 'printed paper' to Governments then demand interest (at rates they set) on those loans that devalue the principal ad infinitum. And that's before we consider banks bringing fiat currency into existence on the back of..... nothing. They do what we would be jailed for if we tried (counterfeiting). Banks print money 'on demand' with nothing to support it yet you and me would be in hot sh1t if we tried.

Put it this way - would you rather have £1m worth of property or £1m in 'notes'? If I won the Lotto the first thing I'd be doing is getting rid of it (as cash) by buying tangible assets regardless of their current worth as you can't deflate a house away like you can with paper money.

Many advocate the use of gold this way. Nothing wrong with that and always seen as a safe haven for investors and IDENTICAL to digital currency due to its rarity and limited supply.

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For this message the author kellys_eye has received gratitude : joelrod
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