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Tizer
VIP Member


5150 Posts
Posted -  25/06/2010  :  09:59
I just love banks, don't you? They go out of their way to make life exciting and to make sure we are always wondering if our account will have been emptied by tomorrow morning. They spend a fortune launching `Chip & Pin' and trying to convince us that it is infallible and that any fraud on our card in future will be due to our failings, not theirs. They do us great favours like deciding, unilaterally, to get rid of cheques. They are so good to us I thought we should reward them with a thread devoted to their marvellous escapades. Let me start with this offering but please add your own experiences and comments...

We have received a letter from Santander (Abbey Nat to you and me) beginning "We are deligted to inform you..." which always sets alarm bells ringing, and ends "As Santander we will continue to offer innovative, great value products and are committed to delivering excellent service to our customers" which sets the sirens blaring.  What they are delighted to inform me is that they have upgraded (without consulting me) my Cheque Guarantee Card to a Visa Debit Card. But I don't want a Visa debit card, I don't need another card, it's just another thing to get stolen, lost or defrauded.

But there's a sting in the tail. They then tell me to destroy my cheque guarantee card by cutting it in half. OK, I think, the new card will be used for this instead. But no, lower down in the letter it says the new card cannot be used to guarantee cheques. I know that cheques are set to be phased out (unilaterally once again, by June 2011) but it looks like the banks have devised a great scam to deprive us of cheque guarantee cards so they can say that cheques are not much use. I use cheques a lot and I would prefer that they were not phased out, but then, hey, the banks are not there just for you and me, are they?

I notice that although the letter tells me to destroy the cheque card, nowhere does it say that I cannot continue to use it. So I'm going to use it for as long as possible. I advise everyone to do the same. The banks are just hoping we will all fall in line with their demands and destroy the cards immediately.


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catgate
Senior Member


1764 Posts
Posted - 12/09/2010 : 22:41


quote:
Anni wrote:
I am not convinced that this country generates enough tax to meet it's obligations.  So I wonder where the money comes from.
 

I "know" that this country generates "obligations" that cannot be met by the tax it generates.

The money that  it spends does not exist, so it does the thing that the bankers, and their cohorts "the special advisers andconsultants", recommend to all......it lives on credit to be paid back tomorrow......by which time someone else will have to clear up the mess.


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Anni
Regular Member


634 Posts
Posted - 12/09/2010 : 23:26
Thanks Catgate, that is what I figured.

But of course, my next question is "who is lending us and all the other countries in the same position" this money.

I mean most countries don't generate enough tax to meet their obligations do they.  So who / where is this "bank".

It makes you wonder though doesn't it?  Or maybe I should just get a life LaughingLaughing


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Stanley
Local Historian & Old Fart


36804 Posts
Posted - 13/09/2010 : 07:07
Annis, the same thought occurred to me, if he's married how does he treat his wife?

I disagree about tax. Ask the taxpayer whether it's real money when it goes out of their pockets. Throughout the whole of history since about 1000AD in Europe, the ability of the rulers to milk tax from their subjects has been the single most important factor in retaining power. This still applies today and it is the deficit between the tax collected and the money spent which is the cause of the present problem. In the latter days of the last government they were spending £3 for every £2 tax collected. It is this deficit which has to be funded by 'funny money' borrowed from the market or 'manufactured' by printing more notes. (Actually they don't do that they just sell government bonds to the market.) The modern term for it is 'financial easing', sounds better than devaluing the currency! The tax take is real money, the deficit financing is funny money.

'The Cuts' that we are hearin so much about is the mistaken belief by the government that they can reduce the deficit and pay back the borrowings by reducing spending (easiest targets first of course!). In addition they are looking at the same source to pay off the accumulated debt over the next 10+ years. In the 1920s and 30s this was called the 'pursuit of sound money' and the policy stifled the economy to the point where it slipped into the inter-war depression. We learned then (both here and in the US) that the correct course was sensible government cuts, taxing the wealthy and investing in public works like the infrastructure, this injected funding into the economy at worker level and this money was spent, moving up the food chain until it finally returned to the government in the shape of higher taxes. This is the well understood 'Multiplier Effect' and is what saved us pre-WW2, it also gave us a more efficient infrastructure, another bonus. What the Condem Coalition is doing is the exact opposite of this, they are stifling growth by squeezing the lowest layers of society which looks good on the books in the short term but eventually shrinks the real economy to the point where it can't sustain itself. This is the con-trick and it's happening now.

Before anyone starts to argue, go back, read the history and ask yourself how the US and the UK managed to finance a full-scale World War and achieve recovery 30 years later. The answer is deficit financed spending on real assets, not throwing £1trillion at the bankers!


Stanley Challenger Graham




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Anni
Regular Member


634 Posts
Posted - 13/09/2010 : 08:16
Morning Stanley!

I suppose my problem is, I wonder about these things.  And as I was reading your post, I remembered back in the early 70's when I moved abroad, there was a limit on how much money you could take out of the country - I think it was £25.00 which is about £230.00 today.

I remember I used to be really cross - it was my money, I had earnt it and saved it out of what I had over after having paid taxes and therefore it just didn't seem right that  I was being told I couldn't take it to where I needed it.

I suppose the theory was, that the money had to be spent/kept in the UK to generate further money.  i.e. spend it here and not there.

There used to be some kind of theory/rumour doing the rounds that there were 6 super power families who effectively controlled the finances of the world.  I can't remember the exact details nor whether there was likely to be any truth in the matter.  But again, something which is not totally beyond the realms of possibility.

I caught a snippet of Hard Talk on the Beeb overnight where a Chinese Minister was being interviewed.  House prices have rocketed since 2002 by 100 times what they were then in some cities and there was a discussion about what would happen if this crashed.  I drifted off back to sleep but guess I could get it on iPlayer if I fancied.

I know someone who trades on the stock market and foreign exchange.  The sums of money they earn are frankly, scary.  What is more scary is how they have changed while all along maintaining some kind of naive innocence that they aren't being greedy.  I soon got bored with the conversations.

Anyway, got to go and get some new teeth - something else which kind of annoys me - since I moved 8 years ago, I haven't been able to find an NHS dentist so have to pay privately.   


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Tizer
VIP Member


5150 Posts
Posted - 13/09/2010 : 10:48
King Canute made taxing people such a fine art in England that it's no wonder William the Bastard and his Norman mates invaded in 1066. I can see the dollar symbols in William's eyes now.

I like the idea of spending on infrastructure as the US did in the 1930s but where does the money come from? More borrowing? Easing? I'm not trying to get into political debate here but simply looking at the practical aspects.


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Stanley
Local Historian & Old Fart


36804 Posts
Posted - 13/09/2010 : 16:53
The eminences gris in the Tory Party who got Thatcher in did it because they knew she adhered to their thinking on financial matters. First executive action was to remove Currency Controls on export of capital. Look it up!


Stanley Challenger Graham




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catgate
Senior Member


1764 Posts
Posted - 13/09/2010 : 20:35


quote:
Anni wrote:
Thanks Catgate, that is what I figured.

But of course, my next question is "who is lending us and all the other countries in the same position" this money.

I mean most countries don't generate enough tax to meet their obligations do they.  So who / where is this "bank".

It makes you wonder though doesn't it?  Or maybe I should just get a life LaughingLaughing


Sorry this may be long and boring, Anni, and not in accordance with the popularly held myth but just see what you think.

Before launching forth n the subject of finance it is necessary to understand what money really is.

In the real olden times, even farther back than Stanley can remember, there was no way of “trading” other than by barter. That trading might have been “product for product”, or “labour for product”, but the important thing to realise is that any product being bartered was always nothing but the sum total of the labour which had gone into its creation, be it animal, vegetable or mineral. So the product, whatever it was, represented the summation of all the energy expended n its production.

Somewhere along the line it was realised that it would be possible to improve trading by the use of something, a token, to represent that energy, and that token could then be used in exchange for product (energy) at a later time. In time this led to coinage which we now know as money. So money is in effect surrogate energy. It is, in itself, useless, (you can not eat it, drink it, wrap up warm in it, ride to the seaside on it etc.) its only value is in what it represents.......energy.

Now, the Law of the Conservation of Energy, which was recognised by Sir Isaac Newton and others even earlier, and which was brought into much more modern relevance by Albert Einstein in his work on Relativity, states simply that “energy can not be created, it can only be converted from one form to another”. It follows from this proven truth that
although it may be possible to create tokens they will only be dead/imitation/worthless tokens if they do not represent the conversion of real energy. You simply can not print money, because it will be a worthless forgery of of energy. It will be a lie.

In a real balanced economy there should be in circulation an amount of tokens  rrepresenting the value of the goods and services which make up the communities assets. If this is out of balance inflation or deflation (as they are called) is the result. (*)

The banks have to some extent got round this by not lending real money. They lend “pretend” money which they call “credit” and which is nothing but “notional nonsense” with the solidity of Monopoly Money. There is nothing
there to “back it” and it is entirely devoid of the energy which gives it value. (They actually “lend” many times more than the actual money they have on deposit....have you heard the term “gearing”?)

Now for every parcel of this worthless credit they lend they require the punter to repay all of it, plus the interest, in “real” money through the transfer of money created by expending energy.

The result, as can readily be undestood, is a shortage of real money. So more loans are taken out and more debt is created and so the merry-go-round continues to go round. (* above)

All goods produced are subject to decay from the moment they are constructed, and as a result, even with good  maintenance, they lose their value. The one outstanding apparent exception is the assemblage of stones/brick,mortar/cement, timber, pipework etc that goes into making a house. This is the most expensive thing that a man ever
buys, and, as such, it creates an enormous impression on a man's thinking. It is his anchor, his safety net, his major asset. In the earlier days of Commercial TV there was an advert urging everyone to “Get the Strength of the Building Societies” around themselves.

If anything like the actual depreciation in value of a house were to be deducted from its book value year after year, house prices would not go up year on year but would very rapidly decline. As it is the building societies (who have all morphed into banks or been taken over by banks ) keep up the pretence that house prices are “as safe as houses”. They could not make the vast obscene profit that the do if the value of houses followed a natural course. As a result the economy ( * above ) become unbalanced.

The Government borrowings are exactly the same. They borrow “notional nonsense”. This latest wheeze has been to call it “Quantitive Easing”, but it is still the same stuff, just “puff”, but what will be taken out of the workforce's pay, as PAYE, will be real tokens for energy

The matter of inflation is always accompanied by talk of devaluation and this when looked at  from the standpoint of energy is utter twaddle. If today it takes a man an hoursworth of energy to make a grunnion flange it will still take a man an hoursworth of energy to make a grunnion flange when the devaluation occurs. So the devaluation has nothing to do with the real value of energy and everything to do with the manipulation of numbers in order to once more pull the wool over the public's eyes.

 

Edited by - catgate on 14/09/2010 10:36:16 AM

Edited by - catgate on 14/09/2010 10:40:03 AM


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Stanley
Local Historian & Old Fart


36804 Posts
Posted - 14/09/2010 : 07:26
I can go back far earlier Catty but kept it simple so that people can take it in who haven't studied economics.

Brendan Barber did his job as GS of the TUC well in his speech. He assessed the situation, forecast the fallout and said that the TUC would support their members and coordinate action, exactly what he is supposed to do. The Mail and Telegraph version is 'TUC secretary threatens to bring the UK to a standstill'. Par for the course but does nothing towards better understanding of what is happening and the probable consequences. He's right in at least one respect, we ain't seen nothing yet and when the reality dawns on the electorate the problem isn't going to be strikes, it will be public protest.

Did anyone listen to John Cornwell on C4 news last night? Brilliant interview and a very gloomy assessment from a man who is deeply connected with the secret nets of power in our country. If you missed it find it and listen to him. Well worth it.

Peter Tatchell's polemic against the Pope which followed the news was savage but I thought rang true. He makes a devastating case against the worst parts of church dogma and shows the results. 

http://en.wikipedia.org/wiki/Richard_Williamson_%28bishop%29

He also addressed the matter of Bishop Williamson, a holocaust denier and the lack of action against him by Rome. I had never heard of this man and well worth looking at the Wikipedia link above. It was chilling to hear the official spokesperson for the Papal visit denying that the use of condoms reduced HIV infection, citing 'scientific research that condoms have holes in them'. The programme of course confirmed my own views and you have to be cautious when you realise this is happening. I bore this in mind but still ended up with the opinion that it was fair comment and cited good evidence. Bad news for the Pope but in the end good news for Catholics in the long run, the church of Rome will only survive if it moves with the times and the flow of evidence. Retreating into a medieval mind-set will do nothing but harm.

Tiz, it's the Keynsian model of 'deficit-financed spending. In other words it is borrowed money raised by selling government bonds mainly. One great advantage of a programme like this is that it tends to reinforce the value of such bonds making them more attractive because the potential purchasers can see that the capital is being invested in real assets which will contribute to growth. We are selling such bonds now but there is no colateral beyond the confidence of the market, the big worry about this is devaluation of such bonds raised to finance the banks if the economy remains stagnant. The money raised is used to prime the pumps of the economy and take advantage of the multiplier effect. The cost is the repayment of the interest and the debt which is spread over a finite number of years. I have argued for the last three years that if half the money thrown at the banks in a panic to alleviate short term difficulties had been injected into the infrastructure it would have stimulated growth and produced concrete dividends in the shape of employment, flows of money in the internal economy and real benefits of public works that in themselves increase our efficiency. Unfortunately Godron and his cohorts were fixated on the banks, remember 'too big to be allowed to fail'? They made a massive mistake because they were thinking in the short-term. Look at Roosevelt and the 'New Deal' in the US. Lots of flaws in the programme but a massive injection into not only industry and construction but the arts which eventually worked. The war was largely financed in the US by War Bonds. Here it was subsidy from the recovering US economy and Post War Credits, our version of the US War Bonds. None of this was perfect but twenty years later we could say we had survived and were rebuilding a peace time economy. Remember that six years after entering the massive undertaking of financing war effort from a low base the Labour administration initiated the biggest social reform the UK has ever seen, the Welfare State. We were far worse off then that we are now but look at the difference in attitudes.


Stanley Challenger Graham




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catgate
Senior Member


1764 Posts
Posted - 14/09/2010 : 10:48


quote:
Stanley wrote:
I can go back far earlier Catty but kept it simple so that people can take it in who haven't studied economics.



So can you explain to me, in simple terms, so that I can understand it, "What is money"?

To understand finance and even simple economics I feel it is important know just exactly what money is and what gives it value.


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Stanley
Local Historian & Old Fart


36804 Posts
Posted - 14/09/2010 : 16:19
Better and more3 important things to do than start a debate on that Catty, you keep posting.....


Stanley Challenger Graham




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catgate
Senior Member


1764 Posts
Posted - 14/09/2010 : 17:28


quote:
Stanley wrote:
Better and more3 important things to do than start a debate on that Catty, you keep posting.....

I see  I think you have now fully explained your position.

 


Every silver lining has a cloud.


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Stanley
Local Historian & Old Fart


36804 Posts
Posted - 15/09/2010 : 07:49
You've got it. Far more important to read my Mate Martha's book on the Kipper und Wipperzeit' (To be published by Yale in the Autumn.) This is the inflation during the Thirty Years' War caused by debasing the coinage to pay for huge armies. (Ring any bells?) Reading this gives me a better take on the Thirty Years' War itself as I'm reading Parker's book on that at the moment. So you can see why a pointless debate on the meaning of money has no attractions for me. Sorry but there it is, something is more important, productive and interesting.


Stanley Challenger Graham




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catgate
Senior Member


1764 Posts
Posted - 15/09/2010 : 10:23


quote:
Stanley wrote:
 So you can see why a pointless debate on the meaning of money has no attractions for me. Sorry but there it is, something is more important, productive and interesting.

Stanley I did not ask you to debate anything.

I answered Anni's question in a way that I hoped would be informative. As a result of this answer you posted a long piece which did not seem to further the matter.

As a result I asked you a question, which you declined to answer, inferring that an understanding of what money really represents is totally unimportant.

The one thing that has got the world into the mess it is in is the fact that man has been "hypnotised" by the banks for generations.

 


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Stanley
Local Historian & Old Fart


36804 Posts
Posted - 15/09/2010 : 16:14
You're debating with yourself.....


Stanley Challenger Graham




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Stanley
Local Historian & Old Fart


36804 Posts
Posted - 17/09/2010 : 06:29
Not exactly banking but have you noted the latest O'Leary shenigans about musicians and their instruments? Even something as small as a tin whistle has to either go in the hold or have a seat bought for it. Latest victim was a very young violinist with a half-size violin on her way to a contest. Accepted for flight then told she had to pay for another seat at the gate. Budget travel? His chief training pilot has said that O'Leary should be replaced as chairman by a flight attendant to save on the wages bill. Gone public as well! I wonder how long he'll be in post?

http://www.thisismoney.co.uk/news/article.html?in_article_id=514564&in_page_id=2


Stanley Challenger Graham




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