Wednesday, 12 June 2013

The Essence of Money as the token that represents contracts of credit.

My Letter to Editor published in Taranaki Daily News Monday June 10 2013 re former investment banker and current New Zealand Prime Minister John Key SkyCity casino deal and the essence of money;
Cheap Money
Interesting times, Gordon Brown(All the wowser whining is a load of pathetic piffle, May 18) claims former investment banker John Key was the politician living in the 'real world' when it came to the alternative loan arrangement for SkyCity to build a $420 million convention centre in Auckland to be repaid out of an indirect gambling tax, as they were the “only one with the cash.”
Apart from recent statements from the very highest levels of the international supply side of money about just how illusory that world is, I wager that SkyCity tendered the job factoring in an interest rate they, just like our domestic trading banks do, knew they could refinance at a cheaper rate with the international money as debt “wholesalers”.
International trading bank lisence-holding “money wholesalers” have extraordinary privileges of receiving fees and interest upon a money system that is a ledger-entry accountancy system of credit contracts of the future exchange of goods and services, of which “money” is a costless token of exchange transferred to complete and clear the credit contract.
For any money system to remain honest those administering it must ensure that the authorised contracts of credit dont exceed the ability of real resources to clear them; even more important under the entirely interest bearing, private-institution-loan-based money supply system New Zealand politicians have absurdly contracted us to.
Especially when those institutions, in pursuit of short-term profit, have been proven to have issued us, and many other nations, more credit contracts than the “real” economy could ever clear.
Iain Parker

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