Sense, I was young I´ve always thought that the banks only are financial intermediaries of money, but they´re also creators of money and they do it through credit. Whenever a credit is raised, money comes into existence and that´s something I think all of us need to know. That´s the bank´s way of earning money, to lend money created out of thin and then put interest on it. To me, this reality becomes more and more obvious when rates are close to zero and most people and countries are buried in dept. Until today, I haven´t heard a bank saying that we don´t have any money to lend because there are too few depositors. And for that reason, I think there is fewer and fewer that save their money on bank accounts with 0% of earnings. So, where does all money comes from?
I think our current financial system is in its final steps and I believe we´re on the doorstep towards another system where cryptocurrencies seem to be a part of. Professor in Economics, Richard A Werner from England talks about this and linked bellow is both a video and a great article by him, posted in International Review of Financial Analysis, Dec 2014.
http://www.sciencedirect.com/science/article/pii/S1057521914001434
Yes its crazy isn't it, you create the money with a promise agreement they then lend you back your own money and if that is not enough piss taking, they then charge you interest!
Fully agree! It's amazing....I don't know what to think. We're worth something better.
Hope crypto currencies will eliminate fractional reserve system which is nothing else than inflationary tax in favor of banks.
I definitely believe crypto currencies are here to stay and when the system crash (which I hope it will), cryptos will be an alternative.
But how will a system that crashes help those who are not a part of it? Do people in underdeveloped/lack of internet countries & regions have crypto? Probably not. So how would those, who rely on physical currency survive?
No, I definitely not think it will be easy. Absolutely not, but nothing last forever and I don't see how current system can survive, but maybe it will. Too me it's a system that enslave people. Money are produced out thin air and lend out with interest applied. We've lived in this system for so long and nobody knows anything better. We got so used to it and it will probably be painful to let go of it. We'll see.
I believe that people that has the biggest potential to survive a crash of the system, which I think it will sooner or later are the ones who help each other. Humanity have survived many crisis before and it's often the ones who has cooperated who's survived.
Nice info :)
As good as cryptocurrencies are, you might notice a large % still convert their cryptocurrency into fiat currency, at the end of the day people continue to exchange it for "real" money. Once this tradition is broken, there will be real progress.
I admit that I am someone who once did the latter, but now I'm investing for a longer time period and hope to see crypto dominate our society!
Yes, I agree but we need something better that benefits all and not just a few. I believe we´re in the that process. There´s an infinity in the current system which is unfair and we need something that is finite without inflation, which holds purchasing power.