MONEY AND THE CRISIS OF CIVILIZATION, By Charles Eisenstein

[Joanne98]

Suppose you give me a million dollars with the instructions, "Invest this profitably, and I'll pay you well." I'm a sharp dresser -- why not? So I go out onto the street and hand out stacks of bills to random passers-by. Ten thousand dollars each. In return, each scribbles out an IOU for $20,000, payable in five years. I come back to you and say, "Look at these IOUs! I have generated a 20% annual return on your investment." You are very pleased, and pay me an enormous commission.

Now I've got a big stack of IOUs, so I use these "assets" as collateral to borrow even more money, which I lend out to even more people, or sell them to others like myself who do the same. I also buy insurance to cover me in case the borrowers default -- and I pay for it with those self-same IOUs! Round and round it goes, each new loan becoming somebody's asset on which to borrow yet more money. We all rake in huge commissions and bonuses, as the total face value of all the assets we've created from that initial million dollars is now fifty times that.

Then one day, the first batch of IOUs comes due. But guess what? The person who scribbled his name on the IOU can't pay me back right now. In fact, lots of the borrowers can't. I try to hush this embarrassing fact up as long as possible, but pretty soon you get suspicious. You want your million dollars back -- in cash. I try to sell the IOUs and their derivatives that I hold, but everyone else is suspicious too, and no one buys them. The insurance company tries to cover my losses, but it can only do so by selling the IOUs I gave it!

So finally, the government steps in and buys the IOUs, bails out the insurance company and everyone else holding the IOUs and the derivatives stacked on them. Their total value is way more than a million dollars now. I and my fellow entrepreneurs retire with our lucre. Everyone else pays for it.

Continued>>>
http://carolynbaker.net/site/content/view/883/1/

[Hugin]

1. What a great description of the crisis.

Clearest yet. :thumbsup:

[bemildred]

2. Perfect. nt

[Marblehead]

3. ponzi scheme..

[silverweb]

4. Well expressed.

The article echoes much of what the on-line movie, _Zeitgeist: Addendum_. I watched it last week and it was very good, expressing the "money as debt" point of view very clearly.

The Zeitgeist movies may not appeal to everyone, and I have some reservations with regard to a couple of points in both movies, but this particular subject is very well covered in Addendum.

[Peace Patriot]

5. This is called a pyramid scheme. And the rotten-to-the-core government of Colombia

is about to fall because of a comparatively small-time pyramid scheme there, with close ties to Bush pal, President Uribe.

Poor Uribe! He didn't learn well at Bush's knee. You scam people. You get in trouble. You charge...the people! A thousand times over. Then you buy Tahiti! Or France! Or...wait (lawyers flipping through extradition treaties), oh, heck, there's extradition treaties goldarn everywhere now, which we did to get our AWOLs back for our mass murders of people with oil, even Paraguay. What a world! You can't even buy a country any more, with your trillions in blood money squeezed out of the mouths of future tiny babies, as yet only twinkles in their great grandparents' eyes. Phooey! But there IS one place. You can still buy DALLAS! But I don't think they'd let a furinner buy it, cept a Saudi prince maybe. No matter how much you steal from the little people. You got to steal big to buy Dallas, and be an Amurkin with bonyfiddles...hey, hey...bonyfiddles...welcome to my hangin'... or a family member of Osama bin Laden...and you got to squeeze 'em HA-A-A-ARD forever, squeeze every last drop of blood out of 'em, forever and ever! Then you can buy Dallas, and nobody can stop you.

[LongTomH]

6. There are some interesting possibilities here!

Consider this paragraph:

In previous essays <1> I have described alternative money systems, based on mutual credit and demurrage, that do not drive the conversion of all that is good, true, and beautiful into money. These enact a fundamentally different human identity, a fundamentally different sense of self, from what dominates today. No more will it be true that more for me is less for you. On a personal level, the deepest possible revolution we can enact is a revolution in our sense of self, in our identity. The discrete and separate self of Descartes and Adam Smith has run its course and is becoming obsolete. We are realizing our own inseparateness, from each other and from the totality of all life. Interest denies this union, for it seeks growth of the separate self and the expense of something external, something other. Probably everyone reading this essay agrees with the principles of interconnectedness, whether from a Buddhistic or an ecological perspective. The time has come to live it. It is time to enter the spirit of the gift, which embodies the felt understanding of non-separation. It is becoming abundantly obvious that less for you (in all its dimensions) is also less for me. The ideology of perpetual gain has brought us to a state of poverty so destitute that we are gasping for air. That ideology, and the civilization built upon it, is what is collapsing today.