Best of the Week
Most Popular
1.Canada Real Estate Bubble - Harry_Dent
2.UK House Prices ‘On Brink’ Of Massive 40% Collapse - GoldCore
3.Best Cash ISA for Soaring Inflation, Kent Reliance Illustrates the Great ISA Rip Off - Nadeem_Walayat
4.Understanding true money, Pound Sterling must make another historic low, Euro and Gold outlook! - Marc_Horn
5.5 Maps That Explain The Modern Middle East - GEORGE FRIEDMAN
6.Gold Back With A Vengeance As Bitcoin Bubble Bursts - OilPrice_Com
7.Gold Summer Doldrums - Zeal_LLC
8.Crude Oil Trade & Nasdaq QQQ Update - Plunger
9.Gold And Silver – Why No Rally? Lies, Lies, And More Lies - Michael_Noonan
10.UK Election 2017 Disaster, Fake BrExit Chaos, Forecasting Lessons for Next Time - Nadeem_Walayat
Last 7 days
Why Surging UK Household Debt Will Cause The Next Crisis - 27th Jul 17
Reconciling the US Dollar Outlook with the Super Bullish Gold and Silver COTs - 26th Jul 17
Last Week’s Rally in Gold Stocks Erased - 26th Jul 17
Dollar, Bitcoin, Markets - Is There A New Flight To Safety? - 26th Jul 17
Central Banks ARE The Crisis - 26th Jul 17
Iran: Public Image Versus Historical Reality - Part 1: An Abridged History to the 20th Century - 26th Jul 17
Trump Fails To Understand One Critical Thing—Our Trade Partners Have Options, Too - 26th Jul 17
Stock Market and Gold Stocks Trend Forecast Update - 25th Jul 17
Saving Illinois: Getting More Bang for Its Bucks - 24th Jul 17
3 Stocks Sectors That Will Win in The Fed’s Great Balance-Sheet Unwind - 24th Jul 17
Activist Investors Are Taking Over Wall Street, Procter and Gamble Might Never Remain the Same - 24th Jul 17
Stock Market Still on Track - 24th Jul 17
Last Chance For US Dollar To Rally - 24th Jul 17
UK House Prices Momentum Crash Warns of 2017 Bear Market - Video - 22nd Jul 17
Crude Oil, Gold, ETFs & more: Pro-grade Market Forecasts - 22nd Jul 17
Warning: The Fed Is Preparing to Crash the Financial System Again - 21st Jul 17
Gold / Silver Shorts Extreme - 21st Jul 17
GBP/USD Bearish Factors - 21st Jul 17
Gold Hedges Against Currency Devaluation and Cost Of Fuel, Food, Beer and Housing - 21st Jul 17
Is It Worth Investing in Palladium? - 21st Jul 17
UK House Prices Momentum Crash Threatens Mini Bear Market 2017 - 21st Jul 17
The Fed May Show Trump No Love - 20th Jul 17
The 3 Best Asset Classes To Brace Your Portfolio For The Next Financial Crisis - 20th Jul 17
Gold Stocks and Bonds - Preparing for THE Bottom - 20th Jul 17
Millennials Can Punt On Bitcoin, Own Safe Haven Gold For Long Term - 20th Jul 17
Trump Has Found A Loophole To Rewrite Trade Agreements Without Anyone’s Permission - 20th Jul 17
Basic Materials and Commodities Analysis and Trend Forecasts - 20th Jul 17
Bitcoin PullBack Is Over (For Now): Cryptocurrencies Gain Nearly A 50% In Last 48 Hours - 19th Jul 17
AAPL's 6% June slide - When Prices Are Falling, TWO Numbers Matter Most - 19th Jul 17
Discover Why A Major American Revolution Is Brewing - 19th Jul 17
iGaming – Stock Prices - 19th Jul 17

Market Oracle FREE Newsletter

Crude Oil, Gold, ETFs & more: Pro-grade Market Forecasts

Credit Crisis Solution: Social Credit

Politics / Credit Crisis 2009 Mar 01, 2009 - 06:40 AM GMT

By: Christopher_Quigley

Politics Best Financial Markets Analysis Article"Banking and credit are too important a business for citizens and politicians to be ignorant of. Upon its fair and equitable administration rests the very existence and future of our society".


Every society has its orthodoxy. But there comes a time when the "accepted view" no longer functions. When this occurs it is time for change. The movement of stars told Galileo that the earth centred Universe was wrong. The relative inner stability of two moving trains told Einstein that Newton and Euclid were wrong. The current Sub-Prime credit crisis is an indication that the orthodox concept of banking and credit is wrong.

This is not the first time that the failings of the accepted "credit concept" were identified as being erroneous in an increasingly technologically efficient world. The great depression of 1929 also gave the same signal. However instead of dealing with the cause only the symptoms were addressed. Accordingly, another world war ensued and through "sticking plaster" policy modifications we bungled on for another 80 years. Now, once again, the dormant "error" has become virulent and threatens the whole. The disease within the economic body was diagnosed successfully in the early 1900's and a solution was prescribed but ignored. The same remedy will work today but its successful application requires a "Copernican" change in economic conceptional modalities. The world was not ready then. Is it ready now? The cure is called: "Social Credit".

Due to developments in technology and technique the age old problems of production and scarcity have been all but solved, the issue now is one of distribution . Money creates effective demand and orthodox banking and accounting rules makes money scarce.

This state of affairs if allowed to continue will result in:

1. Surplus production due to efficiencies

2. Consequent unemployment and under-employment resulting in effective demand destruction

3. Poverty due to lack of purchasing power

4. Redundant industrial machinery

5. Consequent cut-throat competition

6. Disappearance of industrial profits

7. Consequent business bankruptcy and depression

8. Aggressive competition for foreign markets

9. Consequent international friction and war

In order to prevent the above constantly recurring, as in 1929 and now with the sub-prime crisis, it is necessary to change our orthodox view of economics. WE MUST MOVE FROM AN OUT-DATED MINDSET. This does not require a revolution in society it simply requires a revolution in our consciousness. However the elite who control the ownership of the "orthodox" credit myth will not allow acceptance of this alternative knowledge because to do so will weaken their system of management and domination. However truth is an amazing thing .

Slowly but surely, like a seed whose hibernation is over, the practicality and human goodness of the concept of Social Credit is germinating. But it needs aware and dedicated followers to nurture this growth. MONEY MUST NOT BE REGARDED AS A COMMODITY. IT IS IN ESSENCE A MEANS OF DISTRIBUTION OF SOCIAL PRODUCTIVE CAPACITY. AS A RAILWAY TICKET IS TO A TRAIN NETWORK THE DOLLAR BILL IS TO THE ECONOMIC SYSTEM. THE OBJECTIVE IS NOT TO OWN ALL THE TICKETS BUT TO HAVE A RAILWAY SYSTEM THAT SERVES THE FUNCTION OF MOVING PEOPLE AND GOODS. Through our ignorance of banking and credit, politicians have allowed an elite professional group corner the market for "railway tickets" and thus control the "transport network".

For the current economic crisis to be finally resolved the realisation must sink in that BANKING IS NOT SIMPLY AN AVERAGE BUSINESS LIKE ANY OTHER . On the contrary, upon its fair and equitable administration rests the very existence and future of our society. Banking and credit are too important a "business" for citizens and politicians to be ignorant of. To deal with this matter we must, to use the words of President Obama: "up our game" or perish.

The word credit comes from the Latin word "CREDERE", meaning "TO BELIEVE". The essential quality of money, therefore, is the belief that one can get what one wants when one possesses it; THUS MONEY IS A SOCIAL CONTRACT BASED ON TRUST AND MUTUAL BENEFIT . Since credit is a function of money it follows, axiomatically, that CREDIT IS A SOCIAL CONTRACT ALSO. A society cannot allow a particular grouping to have a monopoly on the functioning of this social contract because ultimately this group could end up monopolising all contracts. If you own the contracts you will end up owning society.

The central problem which Social Credit addresses is the negative consequences resulting from the increasing use of capital in manufacture and distribution. This drive towards capital intensification brings efficiency but it decreases the requirement for labour. With the loss, or through the down-grading, of "jobs", the trend is for higher unemployment and/or under-employment. With under-employment there is less purchasing power in the economy thus the true potential capacity of modernity cannot be attained because there is no effective demand, since desire without money is meaningless in our system.

Social Credit strives to solve this spiral of lower employment, lower wages, recession and depression by increasing effective demand in the system by generating societal purchasing power. Purchasing capability is increased through a social dividend and the adjustment of prices. It also proposes that the ownership of credit reside with the society rather than with a monopoly group. Thus excess reserves owned by credit institutions, over a certain minimum to allow their sustained and stable operation, are systematically issued to society. Social Credit believes in banking but does not accept monopoly ownership of credit and legal tender.

The objective of such policies are as follows:

1. Money is no longer a commodity controlled by banks

2. Credit is no longer a social contract controlled by banks

3. Boom and bust credit cycles are negated

4. Increased stable purchasing power allows for effective distribution of goods and services.

This stability allows better long term decisions to be made by entrepreneurs about the economy.

5. Increased demand for goods and services boosts an economy centred on smaller community based businesses.

6. Corporatism diminishes

7. Unemployment and under-employment are seen as opportunities for freedom to develop since citizens are able to function in the economic system through receipt of social dividends. Due to a change in the "zeitgeist" time is no longer equated to work in order to obtain legal tender.

8. Speculation diminishes due to the non availability of "commodity" credit and a real economy, rather than a gambling economy, flourishes.

9. Government down-sizes due to the diminished availability of monetised debt.

Many folk have attacked these objectives as idealist or socialist. They are wrong. In fairness these objectives are based more on community than the commune. But that is the point. Social Credit strives to reaffirm the supremacy of human association rather than abstract institutionalism. Capitalism, under our current banking arrangements, and communism /socialism are all "Cesarist" theories of society; they end in monopoly ownership of everything. This monopoly results in the "state" or "core political group" being master of the individual. As a result community dies and corporatism thrives. The philosophy of Social Credit is the exact opposite. It believes in the individual and it aspires to provide the individual with as much freedom as possible. It acknowledges that the STATE SHOULD EXIST TO SERVE THE INDIVIDUAL ; NOT THE OTHER WAY ROUND. Social Credit therefore rejects the dialectic materialism of capitalism/communism/socialism; and accepts grace.

As this sub-prime crises festers and invades the social, economic and political body I hope that more and more like minded people will become focused, educated and aware. There is no more important goal in life than actively participating in the growth and development of one's spirit, one's family, one's community and one's nation. "Banking and credit are too important a business for citizens and politicians to be ignorant of. To deal with this matter we must, to repeat, up our game or perish".

References:

"Economic Democracy"
Major C. H. Douglas
Bloomfield books

"Aladdin's Lamp: The Wealth of the American People"
Gorham Munson
Creative Age Press: New York

New Zealand Government's
Monetary Committee
Notes of Evidence and Correspondence
Wellington, 24th. February 1934

By Christopher M. Quigley
B.Sc., M.M.I.I. Grad., M.A.
http://www.wealthbuilder.ie

Mr. Quigley is 46 years of age and holds a Batchelor Degree in Management from Trinity College/College of Commerce, Dublin and is a graduate of the Marketing Institute of Ireland. He commenced investing in the Stock Market in San Francisco, California where he lived for 6 years. Now based in Dublin, Mr. Quigley actively trades utilising the principles set out in the modules above. This Wealthbuilder course has been developed over the last 9 years as a result of research, study, experience and successful application.

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any trading losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors before engaging in any trading activities.

Christopher M. Quigley Archive

© 2005-2017 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Comments

John M. of Western Australia
30 May 10, 07:56
Credit Crisis Solution: Social Credit

What a wonderfully clear explanation of some of what is wrong with the world's financial and economic systems ! Thank you very much. I'm just sorry I did not search harder to see if there was a Douglas commentary on the Global Financial Crisis. By the way, I would prefer if anyone quoting his books etc. steered away from the "Major" and put in his first Christian name, Clifford, or whatever he was known as to his friends and acquaintances. Titles like "major" aren't really the "in thing" these days, and the critics always sneer at it. Even professors and PhDs ought to be quoted (as authors) with their ordinary names -- leaving the genuine searchers after truth to be pleasantly surprise to find their academic status.

Meanwhile, if you like, please send me some e-mails periodically.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

Catching a Falling Financial Knife