Is Usury a part of Capitalism ?

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Is Usury a part of Capitalism ?

Freedom from Usury
Silver Stock Report
by Jason Hommel, Jan 23, 2004

It is said that those who loan money need the interest due to inflation and due to the time value of money. But this is like saying criminals need to commit crimes in order to make money, so it's ok! No, it's not ok. No, inflation is not a given. And no, money tomorrow certainly can be worth more than money today if society is using honest money.



So, what about banking? Banking, as practiced today, is a criminal monstrosity of the ugliest proportions. The reality is that the Bankers have been bankrupt ever since they thought they needed a central bank to bail them out. Depositors (the lenders) are told lies, that they can withdraw their money at any time, but the reality is their money is loaned out. If people want to invest their money in an enterprise, they should be free to do so on their own. There is no need to resort to trickery and fraud to take their money away from them through this banking scheme that has developed.



Why should depositors be paid 2% and the bankers loan the money out at 4% and let the bankers pocket the difference? If the bankers are the middle men, let the bankers be paid as middle men, and let the bankers collect a small commission as they introduce the depositor (capitalist) to the borrower (business), and let the depositors invest like everyone else if they want to invest. At least this would be an honest transaction, and an honest way to do business to "put the money to productive use".



Appeals to greed, envy, and lust, (along with lies and misinformation) are the primary means to attempt to justify banking. People greedily and falsely assert that capital goes to waste if it is not loaned out and put "to productive use". As if a loan is the only way to put money to use! And as if investing and saving are not valid alternatives!



But capital (gold and silver) that is hoarded is being put to productive use. First, it makes all the rest of the capital that exists that much more rare, and thus increases the value of the rest of the gold and silver in circulation. Second, the side effect of hoarding gold, which makes gold more valuable, is to stimulate the production of more gold through mining and industry, which provides jobs, and creates more wealth. Yes, even hoarding gold provides jobs and creates more wealth!



Yet mining is disparaged as a waste of time when money can be produced so efficiently with a printing press. So, what use is it to spend so much time and energy to mine precious metals in the fist place? What societal benefit is there to creating a gold boom through lack of gold and hoarding? Gold keeps men honest. Gold and silver force honesty in economic transactions, whereas paper money is economic fraud, an abomination, an unjust weight and measure, oppressive, unjust, counterfeit, and criminal. Any industry that forces the rest of men in society to behave honestly (and without the use of force or threat of force) is the most valuable industry that a productive society can have.



Therefore, hoarding gold boosts the value of gold, stimulates mining, and increases the honesty of society. None of that can be bad except in the eyes of the man who has set his eyes to envy the hoarded (and so-called unproductive) gold of the honest man.


http://silverstockreport.com/essays/Fre ... Usury.html

Usury is a matter of opinion. What does "too high" mean when it comes to lending or borrowing?: It is a matter of supply and demand. Interest is the price or rental rate the owner of money charges for its use. The interest rate is, like any price, determined by supply and demand.

ruveyn

Your source is peddling idiocy.

Is a complete misunderstanding of the time value of money argument. Also, money tomorrow worth more than money today means DEFLATION.(which is probably bad for our economic well-being as members of a nation)

But the time value of money simply means that out of all of the possible things, if you could just hold on to your money you'd rather do that rather than restraining your options to only after a period of time in the future. So, if I have a dollar today and I lend it to Bob to receive tomorrow, in this loan, I give up every possibility I could have had if I had only kept my dollar in my own hands. So, if I see a KitKat bar, and I'm a dollar short, that's what I end up losing because I lent the money to Bob.



There is no lie. The depositors CAN withdraw their money at any time. The sum of all depositors might not be able to draw it out all at once, but the bank does make what they can to make sure that any individual depositor can withdraw their money at any time, which is really what the bank is trying to offer in the first place anyway. There is trickery. There is no fraud. There is some crank monetary cultist who wishes to distort both economic theory and ethics to favor this predetermined conclusion.


Greedily? No. Falsely? That's complicated. By having banks, we make standard loans like housing, cars, and everything else pretty standard a lot easier, allowing for these people to get by better. We'd have to significantly restructure the finance system without banks.

Saving, by itself, is less good than loaning. Loans allow two parties to benefit from saved money, who would not benefit otherwise. The lender does so out of their interest, and the borrower for his/her interest, so.... it's a win-win.


Which means that we have less creation of productive capital. Productive capital is GOOD. We want a world with lower interest rates so that way more ideas can be experimented with, and more and better machines can be developed. We want interest rates so that businesses and people can take out the loans they want/need in order to expand and improve their lives.


No... not really. It stimulates the production of more gold, but at the cost of other industries, and frankly... nothing the author has said should encourage us to think this will dramatically change the labor market. The author likely doesn't know or think about labor economics. The labor market, during the good times, is pretty stable. "Creating jobs" isn't a concern because the unemployment rate is pretty much the same.

Also, mining more gold because the currency lacks liquidity isn't wealth creation!! Wealth creation is when people go out and create more widgets, more tires, more computers, better computers, etc, for less money. Putting money into the money supply is actually just waste. If we could have that money supply auto-adjust without the miners, we'd be better off.


Said but not proven. This is ideological nonsense with heavy moral rhetoric.

So.... basically, the entire thing is just a steaming load. Wow.

[youtube]http://www.youtube.com/watch?v=wvUJrGUZ17Q[/youtube]

The problem with gold currency is that a country has the capacity to produce so much but decides to not use that capacity because of insufficient gold. It's not a good reason to not use that capacity.

Using gold as currency makes as much sense to me as using shellfish or something. It's a commodity, not a currency. You shouldn't be able to mine cash or pick it off trees or fish for it.

It someone has five million dollars in their savings account, they can withdraw it anytime they want.


I have this idea though. What if someone started a business where they store people's money for them without loaning it out? I think it's a great idea. The money would never be in danger of getting lost and the full amount would be guaranteed always. Instead of getting paid interest, the person depositing the money would simply pay a fee every month to cover costs. The fee would be contingent upon how much money is deposited.

Such a building where the money is kept would need to be entirely disaster/robbery proof.

It's called a security deposit box. You can store whatever you want in it, including cash. Banks already provide this service.

There is no such thing as a building that is entirely disaster/robbery proof.

The basic tenet of Capitalism is: Gouge where you can.

So, yes. Usury is very much a part of capitalism.

Gold bugs always put this moronic argument forward, "gold is money", gold is not capital, gold is a commodity, why don't we have a boron standard instead, or a caesium standard? silver is also a commodity.
Fact the fiat money system would work better, if we didn't just print willy nilly, thats the only reason its even in trouble.
Gold is a shiny thing, that was used as money before a standardised method of transaction could be divised, look right, if you can't trust merchants then carrying a great shiny yellow thing to use in exchange makes sense because everyone knows what it is so accepts it, but in the modern era, paper will do just fine.

Your bank is not acting as a middle man between loans, imagine if he did and took commission, this is what happens, you lend all your money to paul, the banker takes a % (god knows why but you said he's the middle man) Paul defaults on what you have loaned him, you and paul are now both bankrupt, hooray middle man scheme! bank loses nothing because it wasn't his money, damn it feels good to be a banker

here is what your bank (which is minute in this explanation) does, a 1000 depositors have 1000 pounds each, paul comes and says hey i want a loan of 1000£ , the bank manager says ok, he takes 1 pound out of every thousand and processes the loan, (note our bank manager is doing this with every pound except the basel III required tier one capital so we are holding back 10% ish in this example its 100£) paul is not a very good borrower and he defaults again, DISASTER! however we have only lost a pound, they are around 9 more pauls in our bank, so we unfortunately lose another 9 pounds, However because we are a bank and we are a lot of players, we have loaned out 890 pounds with a 4% interest rate giving us a resounding 38 pounds ish profit per account! so we give our depositors the 2% and take the rest, because we have been able to act collectively.
notice how we left 100£ in the bank untouched at anyone time? well thats because people withdraw from accounts all the time, so we let them, but we know that thats enough money to keep things ticking, may i add that there could be a bank run, there were bank runs on the gold standard that were crippling.

Note the above example is how banking works, now how would saving work without usury? where is the 2 % coming from? nowhere, sorry i forgot your gold system magically gets more valuable, even as more gold is mined...

their is nothing wrong with usury, intact it promotes saving and growth, this myth that gold and silver are somehow magical is beyond stupid, gold is only a good hedge against inflation or corruption. I have a feeling most of the people trying to sell gold and silver, are just con artists taking in idiots.

If i lend paul my block of gold, i can't buy anything with that block of gold? i can't actually do anything, because that money is gone to paul? the only way I'm going to get more money, is if paul gives me 2 blocks of gold

Gold keeps men honest. Gold and silver force honesty in economic transactions, whereas paper money is economic fraud, an abomination, an unjust weight and measure, oppressive, unjust, counterfeit, and criminal.

This is why, i took such a bad view on this, the pure fraud is the writing, why do people have to be honest with gold and silver? surely all the blocks of tungsten they find in gold bars suggest anything but? this is pure baseless ideology, pure idiocy, we revert back to a gold standard and get a more honest society? "i wasn't gonna tell you jim? but now we are on this gold standard i thought id tell you I'm sleeping with your wife"
The honest man? who is the honest man? is he the sucker who these punks tell to buy gold and silver? the guy holding onto 49$/oz silver when its at 26$/oz he's the sucker. quit listening to criminals., why is paper fraud? why is it oppressive?

this really riled me because its the most baseless stupid thing I've seen, all these gold and silver writers seem to be preaching of a day were the working man will be rich with gold and silver "because its always been so" personally given the recent euro crisis, i have quite a large supply of beans, because at the end of the day, you'll be out mining for gold, ill be eating. these people write stupid things in order to sell gold or silver, far above its SPOT market value, they are nothing but criminals, trying to sell hopes and dreams in defunct lumps of metal.

In the USA, usury is usually taken to mean someone who charges excessive interest, such as a loan shark, pay-day loan company, or pawn shop.

Young soldiers are often easy targets for used-car salesmen, because they will sell them cars with loan terms that the soldier often doesn't understand. And, since the soldier would be at risk for losing his security clearance (and being removed from the military) if he defaulted, the used-car salesman can make quite a lot of dough off of these poor chumps.

We usually don't apply the term usury to ethical banks and credit unions.

I can see they get off on deceiving people and they always got that s**t eating grin on their face, They are caught with their hands in the cookie jar and nothing when there should be laws that they go to jail i would enjoy watching them in a cage with hardened criminals

I think of the core of Capitalism as having a free market and private property rights. Basically leaning more toward an economy run by citizens instead of the government.

I'm not sure Usury is unique to capitalism but is certainly enabled under this system. In some cases it seems to me that practicing Usury is a sign of greed, yet I also wonder if it's a sign our economic system is screwy and based to much on debt.

I mean not all debt is a bad thing but in America carrying debt seems like part of our way of life now.

Without land reform there are no property rights.

One problem, though, is that if you have a lot of money then you're missing out on a lot of interest. It's actually one of the reasons that inflation is good -- it encourages people to "put their money to work" by investing, which generates more economic activity which is good for the economy (and why "austerity" is such a bad idea).

If I had a lot of money, I'd probably put some fraction (maybe 10%) of it away "in the matress" (in a secure place) in case of a total disaster, i.e. zombie apocalypse, though.

You mean to say, renting money costs money? Why is that a big deal?

ruveyn