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> The monetary system is pretty well understood. Basic income just becomes another input for money to enter the system. I'm no fan of basic income however basi

> The monetary system is pretty well understood. Basic income just becomes another input for money to enter the system. I'm no fan of basic income however basic income comes from tax. This is redistributive, but not expansionary. You say it's well understood but you seem to think that central bank issued currency is the cause of inflation. Most "money" is created as credit from private banks (against land). Again, basic income is not creating money. Read up on money creation, you will be surprised and then perhaps see how you are being fooled on much of how your entire world works with regard to democracy.

Joeri 11y ago
Basic income does run the risk of causing ancillary money creation. People may end up lending more because they have a guaranteed income. For example, my country at one point introduced a tax credit for home loans, provided it was your only home, to incentivize people to become owner instead of renter and gain financial security. The net effect was that home prices rose to offset the tax credit, because many people lend at the upper range of their budget and suddenly that limit was higher. Basic income risks having a similar effect.
- branchless 11y ago
  Ok yes it could do, but your example augments my main point. Most credit creation is against land. When you incentivise land speculation you create inflation. We've seen this leading up into 2008 when the money supply rocketed. Basic income is IMHO a bad idea and we should do land value tax, as I said in my post. I don't think basic income would prove as inflationary as a direct tax subsidy against land speculation as the former could feed into some land speculation whereas the latter is basically intended to fuel this fire. edit - whoops realised I put about land value tax in my other comment. Anyways: land value tax - the establishment hate it.
deleted 11y ago
[deleted]
- branchless 11y ago
  Oh dear. BoE in their blog have a different idea to you, from their official blog: http://bankunderground.co.uk/2015/06/30/banks-are-not-intermediaries-of-loanable-funds-and-why-this-matters/ http://bankunderground.co.uk/2015/06/30/banks-are-not-interm... > In the simple ILF model, bank loans represent the intermediation of real savings, or loanable funds, between non-bank savers and non-bank borrowers. Lending starts with banks collecting deposits of real resources from one agent, and ends with the lending of those resources to another agent. In the real world, however, banks never intermediate real loanable funds, > Rather, the key function of banks is the provision of financing, meaning the creation of new monetary purchasing power through loans ... The bank therefore creates its own funding, deposits, through lending. It does so through a pure bookkeeping transaction that involves no real resources Read the whole thing. Digest it and don't get caught just trying to win an argument with a guy on the internet. We are now through 2 layers of falsehoods. Layer 1: there is a fixed amount of money Layer 2: reserves and money multipliers From the end of the article: > To summarize, banks are not intermediaries of real loanable funds, they do not collect new deposits from non-bank savers. Instead they provide financing, they create new deposits for their borrowers. This involves the expansion or contraction of gross bookkeeping positions on bank balance sheets, rather than the channelling of real resources through banks.
  - stephengillie 11y ago
    It's very frustrating to discover that everything you've learned in college was either very wrong or completely wrong. This is why I tell people that parties and social time are so much more important than classes, for which I get called an idiot. I've almost never had a bank loan. Banks have traditionally refused to lend to me. Thus we can't have me start with the FMC model; I've always lived in the ILF model. If banks aren't reliant for central banks or others for their money, then why are there not more banks? Why don't we see poor people just set up their own bank, loan money to each other, then use that money to go and buy food and shelter? If banks create money, then where do Bitcoin come from, and why are they valued? What happens if everyone stops using other currencies and use Bitcoin instead? And how does the world of Finance plan to stop this?
charlieflowers 11y ago
I'm curious enough that I'd like to look into your worldview. So please, tell me what to read. What are the 4 or 5 links/resources that explain it best in your opinion?
- branchless 11y ago
  It's not my worldview. It's the world. http://bankunderground.co.uk/2015/06/30/banks-are-not-intermediaries-of-loanable-funds-and-why-this-matters/ http://bankunderground.co.uk/2015/06/30/banks-are-not-interm... http://www.amazon.com/Progress-Poverty-Henry-George-ebook/dp/B004HYH07Q/ref=sr_1_1?ie=UTF8&qid=1435871934&sr=8-1&keywords=progress+and+poverty http://www.amazon.com/Progress-Poverty-Henry-George-ebook/dp... http://www.amazon.com/Soft-Currency-Economics-II-Monetary/dp/1482735431/ref=sr_1_2?ie=UTF8&qid=1435871825&sr=8-2&keywords=modern+monetary+theory http://www.amazon.com/Soft-Currency-Economics-II-Monetary/dp... I'm sure others can post more. Reality is the dreamworld as far as I can see. It's a total disaster that people don't understand they are seeing all productivity gains now (and forever more) captured by land prices.
ZenoArrow 11y ago
"I'm no fan of basic income however basic income comes from tax." Basic income does not need to come from tax. The debt that comes with creating money need not exist, and with debt-free credit you vastly reduce the need for the credit to provide a taxable return. Initiatives such as the Positive Money campaign show that we have got options when it comes to changing how money is created, it's something I believe could work, I'd be interested to hear your thoughts. http://positivemoney.org/ http://positivemoney.org/
- branchless 11y ago
  Sure, but in this case I was responding to the parent comment who was totally unaware of how money/credit works. I get that this could also be supplied via the state by issuing "new" money. It's good you posted a link to this link. Thanks I'm already aware of their work.

Joeri 11y ago

Basic income does run the risk of causing ancillary money creation. People may end up lending more because they have a guaranteed income. For example, my country at one point introduced a tax credit for home loans, provided it was your only home, to incentivize people to become owner instead of renter and gain financial security. The net effect was that home prices rose to offset the tax credit, because many people lend at the upper range of their budget and suddenly that limit was higher. Basic income risks having a similar effect.

branchless 11y ago
Ok yes it could do, but your example augments my main point. Most credit creation is against land. When you incentivise land speculation you create inflation. We've seen this leading up into 2008 when the money supply rocketed. Basic income is IMHO a bad idea and we should do land value tax, as I said in my post. I don't think basic income would prove as inflationary as a direct tax subsidy against land speculation as the former could feed into some land speculation whereas the latter is basically intended to fuel this fire. edit - whoops realised I put about land value tax in my other comment. Anyways: land value tax - the establishment hate it.

deleted 11y ago

[deleted]

branchless 11y ago
Oh dear. BoE in their blog have a different idea to you, from their official blog: http://bankunderground.co.uk/2015/06/30/banks-are-not-intermediaries-of-loanable-funds-and-why-this-matters/ http://bankunderground.co.uk/2015/06/30/banks-are-not-interm... > In the simple ILF model, bank loans represent the intermediation of real savings, or loanable funds, between non-bank savers and non-bank borrowers. Lending starts with banks collecting deposits of real resources from one agent, and ends with the lending of those resources to another agent. In the real world, however, banks never intermediate real loanable funds, > Rather, the key function of banks is the provision of financing, meaning the creation of new monetary purchasing power through loans ... The bank therefore creates its own funding, deposits, through lending. It does so through a pure bookkeeping transaction that involves no real resources Read the whole thing. Digest it and don't get caught just trying to win an argument with a guy on the internet. We are now through 2 layers of falsehoods. Layer 1: there is a fixed amount of money Layer 2: reserves and money multipliers From the end of the article: > To summarize, banks are not intermediaries of real loanable funds, they do not collect new deposits from non-bank savers. Instead they provide financing, they create new deposits for their borrowers. This involves the expansion or contraction of gross bookkeeping positions on bank balance sheets, rather than the channelling of real resources through banks.
- stephengillie 11y ago
  It's very frustrating to discover that everything you've learned in college was either very wrong or completely wrong. This is why I tell people that parties and social time are so much more important than classes, for which I get called an idiot. I've almost never had a bank loan. Banks have traditionally refused to lend to me. Thus we can't have me start with the FMC model; I've always lived in the ILF model. If banks aren't reliant for central banks or others for their money, then why are there not more banks? Why don't we see poor people just set up their own bank, loan money to each other, then use that money to go and buy food and shelter? If banks create money, then where do Bitcoin come from, and why are they valued? What happens if everyone stops using other currencies and use Bitcoin instead? And how does the world of Finance plan to stop this?

charlieflowers 11y ago

I'm curious enough that I'd like to look into your worldview. So please, tell me what to read. What are the 4 or 5 links/resources that explain it best in your opinion?

branchless 11y ago
It's not my worldview. It's the world. http://bankunderground.co.uk/2015/06/30/banks-are-not-intermediaries-of-loanable-funds-and-why-this-matters/ http://bankunderground.co.uk/2015/06/30/banks-are-not-interm... http://www.amazon.com/Progress-Poverty-Henry-George-ebook/dp/B004HYH07Q/ref=sr_1_1?ie=UTF8&qid=1435871934&sr=8-1&keywords=progress+and+poverty http://www.amazon.com/Progress-Poverty-Henry-George-ebook/dp... http://www.amazon.com/Soft-Currency-Economics-II-Monetary/dp/1482735431/ref=sr_1_2?ie=UTF8&qid=1435871825&sr=8-2&keywords=modern+monetary+theory http://www.amazon.com/Soft-Currency-Economics-II-Monetary/dp... I'm sure others can post more. Reality is the dreamworld as far as I can see. It's a total disaster that people don't understand they are seeing all productivity gains now (and forever more) captured by land prices.

ZenoArrow 11y ago

"I'm no fan of basic income however basic income comes from tax." Basic income does not need to come from tax. The debt that comes with creating money need not exist, and with debt-free credit you vastly reduce the need for the credit to provide a taxable return. Initiatives such as the Positive Money campaign show that we have got options when it comes to changing how money is created, it's something I believe could work, I'd be interested to hear your thoughts. http://positivemoney.org/ http://positivemoney.org/

branchless 11y ago
Sure, but in this case I was responding to the parent comment who was totally unaware of how money/credit works. I get that this could also be supplied via the state by issuing "new" money. It's good you posted a link to this link. Thanks I'm already aware of their work.