Let's assume that those of
us here this today are shipwreck survivors, and that we are stranded on a deserted island.
Our only means of survival are to help each other by each doing those things that are
necessary for the betterment of our new community, until we can be rescued. One of us
becomes a farmer, one a fisherman, one a carpenter, and so on.
Each of us has his own role
to play for the survival of the community. No one has any money, and at least for the time
being, there is no need for money, All are contributing equally, and all are on the same
economic level. We are satisfactorily exchanging our goods and services by barter. But
gradually, as the community evolves, it becomes apparent that money will be necessary. Bob
already has a house, and the carpenter doesn't need another hundred pounds of fish. But we
do need to associate, cooperate, and continue to contribute to the community. There needs
to be an acceptable and equitable means of exchanging our goods and services...
Then one day, as the
community is sitting on the beach, talking about their problem, we notice another raft
approaching the island. All are happy to see a new face, and we greet the new arrival
warmly. As we continue to talk, someone in the community tells the new arrival about our
dilemma, about how we started the community, developed it, built it through cooperation,
and advanced to the point where we now need some form of exchange to help make the
community grow and flourish. The new arrival's eyes light up. "I have the answer to
your problem," says the new arrival. "I'm a banker. I'll set to work right now
to print you some money."
The next morning, the whole
community meets in front of the banker's new house. As the banker distributes the money,
he reminds us that the money belong to him, and that we do not "own" it, but
that we can only "borrow" it, and that we must pay a small fee for the privilege
of borrowing it. We can pay that at the end of the year. And he requests that each person
sign the agreement to pay 5%, which is certainly not excessive interest.
The debt cannot be paid back
The first year goes by. The
community functions and prospers during the year; then at the end of the year we return to
the banker, to pay him back what we had borrowed. But we find, to our dismay, that we
cannot repay the loan, because we do not have enough money. We find that we now owe all
that we had borrowed, plus 5%, which is the interest. The $1,000 that we had borrowed has
now become $1,050. Since there is obviously no way to pay back the $50, which is the
interest, the banker suggests that we leave the loan on the books as a $1,000, leaving a
lesser amount of $950 for each of us to operate on for the next year. Seeing no other real
answer, the community agrees to the new terms, and attempts to operate with less money for
another year.
At the end of the second
year, the community faces a similar, but greater, problem. In buying down the loan, we
find that our operating capital has now been cut by 10%, to $900. We realize that if the
plan is allowed to continue, the banker will own the island, in its entirety, having
contributed nothing but the paper and ink (bookkeeping) that was used to monetize the
community's real credit in the first place. Some of the islanders protest.
But the banker has now had a
couple of years to prepare for this day. To counter the objection that is inevitable, he
has taken evasive steps. He has used the time to develop credibility in the community to
educate us as to how valuable his service is, and what a fine contribution he has made to
the community. He established colleges and universities majoring in economics, and teaches
our children and our educators all about his money system. He ensures that few, if any, in
the community are aware that there is another way; and he encourages the community to
discount as ridiculous any suggestion that there could be a better way to finance a
community...
The solution: Social Credit
Then one day, one of the
islanders decides to take a walk along the beach and deliberate upon what has happened to
the community. As he strolls along, head down, thinking, he notices what appears to be the
corner of a book sticking out from the sand. He kneels, and picks up the book and brushes
it off. The title, though tarnished from time, wind, and tide, is still readable -
"The Meaning of Social Credit." The islanders had never heard of this before,
but he has not had a book to read for a long time, so he sits down on the beach to read
it. And as he reads, he becomes more and more interested and excited. He realizes that
this book holds the real answers to his island's financial problem. The book describes how
a community can function very well by simply creating a Balance Sheet, a system of debits
and credits...
He runs back to relate the
exiting news of his discovery to the rest of the community. As he gathers the islanders to
discuss his find, the banker watches with concern. Is his jug up? Has he been found out?
Is the community finally ready to take back its property, and reconstruct it, and once
again have prosperity and cooperation? Friends, only you can answer these questions,
because the island I talk about is your country, and the community I refer to is all of
us.
The story paints a rather
dismal picture of the banking system. Please understand, the average bank manager, teller
or loans officer, has absolutely no knowledge of what you have just learned. They are
merely pawns in a much larger game. But rest assured, those in the upper levels of
management in the finance industry are absolutely certain of what they are doing, and how
it affects the citizens of this country... Any system that enslaves and controls a
population in the way that our finance system does, cannot possibly be from the Lord. So
there is only one other place it could come from...
Banks do not lend out
depositors' money
Does anybody here know where
the banks get the money that they lend out? Actually, most people assume that they lend
out depositors' money. But the Bank Act specifies that the bank must retain the
depositor's money on account, and must pay him interest on it.
So, where else might the
bank get the money?
The Bank Act also specifies
that the bank may create, out of nothing, new credit ("money") through loans,
but that it must have a relationship to the deposits. Originally, the banks were allowed
to lend out six times their deposits, but today banks are allowed to issue new credit up
to 26 times their deposits. That means that if I deposit my $1,000 in a bank, then
that bank can issue loans to the tune of $26,000... Go to the bank, get a loan, and ask
for the loan proceeds in cash. No matter the size of the loan, you cannot get it in cash -
it must be deposited to your account, and cheques written in order to access the money. No
tangible money is ever created; only debits and credits (figures) are created...
Today the only source
of money, whether private, corporate, or governmental need, is a loan from a bank. But you
can never borrow your way out of debt. You can only borrow your way into bankruptcy, at
which time you turn your back on your assets and your hard work, and give up possession of
it to those to whom you owe money, but who gave absolutely no vested interest in your
property...