The Real Purpose of QE…”Today, the bankers’ run at mammon’s considerable table is in its final stage.”

Tuesday, April 15, 2014
By Paul Martin

Darryl Robert Schoon
GoldSeek.com
Tuesday, 15 April 2014

Free markets are a function of supply and demand whereas capital markets are a function of credit and debt

The bankers’ ponzi-scheme – which began with the distortion of free markets in 1694 when the Bank of England began issuing debt-based paper banknotes alongside the Royal Mint’s gold and silver coins – is coming to an end.

The bankers’ wildly successful and long-running scheme, dependent on the uneasy equilibrium between credit and debt, has now been irrevocably destabilized. Aggregate levels of debt are now so high that credit—no matter how cheap and available—cannot restore the balance.

The Achilles heel of the bankers’ scheme is its need to constantly expand to pay the constantly compounding debts created by capitalism’s expansion and contraction cycles; and as long as growth is relative to the supply and demand needs of the underlying economy, bankers are able to skim off societal productivity in the form of compounding interest, i.e. the bankers’ vig.

Soon, they will not be able to do so. Although charging interest is a spectacularly remunerative way to profit, its immorality has been questioned since time immemorial. The Muslim religion still bans the practice although a technical workaround is tolerated. The Catholic Church considered usury a sin and the Torah forbids Jews to charge interest to other Jews, though not to others.

Today, the bankers’ run at mammon’s considerable table is in its final stage. Credit and debt have so distorted supply and demand fundamentals that demand is no longer sufficient to insure the requisite velocity of money; and, without requisite velocity, the bankers’ increasingly sclerotic juggernaut will eventually come to a halt and their time-vulnerable debt-based tower of Babel will come tumbling down.

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