The Nature of Money
June 10th, 2007In a previous post Does Money Grow on Trees? i looked at how money comes into existence but in a broad sense of the word.
In his paper, The Nature of Money, John Kutyn examines in detail what money is starting from the late 16th century. He explores the development of what we know as bank notes from their early days as accommodation bills and the establishment of the Bank of England as a way of funding a war against France.
 He follows the development of money and banking primarily through the legal process andlooks at numerous cases in law of challenges to the meaning of money and the transactions it is used for.
He challenges the banking system to show that it is not acting fraudulently in law when it uses deposits as money and actually creates money via new loans. Of course only a Reserve Bank can create money or so the law states. So is true? Well i suggest you read his paper and draw your own conclusions but he makes a compelling case.
Not content with that he then moves on to looking at the economic impacts of the current system which has a built in imperative for growth resulting in continued boom bust cycles. He argues that this is down to the interest burden and that debt free money is the only way a stable economy can be achieved.
 As we approach yet another global bust and possible depression it is worth relfecting on the themes in this paper.
Tags: bank of england, banking, central banks, debt, economics, federal reserve, inflation, interest, interest free banking, law, money, money reform, money supply, new zealand, politics, reserve bank of new zealand, usury
June 10th, 2007 at 6:02 am
Pity the paper is in Microsoft format - makes it hard for third-worlders and users of free operating systems to use it. Perhaps you might offer alternative formats such as PDF, or even save it from Microsoft as a HTML page?
June 10th, 2007 at 8:00 am
Hi Dave,
Good point. I’ll see to that this week.
Regards
Raf