PERPETUAL GROWTH IS IMPOSSIBLE: We’ve all heard the story of the clever merchant who asked the King to pay him with grains of wheat placed on a chessboard. On the first square he was to receive one grain; on the second, two grains; on the third, four grains — doubling with every square up to the 64th. The King readily agreed to pay such a small sum; How much could it add up to in just 63 doublings, after all? The answer is that more grain than exists in the entire world would have to be placed on the 64th square. That is “the magic of compound interest” and it is 1) the reason that perpetual economic growth is impossible and 2) the reason that economies based on the creation of money as interest-bearing debt (read: all modern economies) inevitably go into crisis and fail.
The maverick Jewish writer Israel Shamir has just published Tom White’s extensive treatment of the subject which is well worth reading.
LOCAL CURRENCIES: Some communities are partially opting out of the debt-money system that is ruling us, failing us, and taking our wealth. They issue their own currency and back it with goods and services produced locally.
The local-currency movement displays a fascinating set of trends: away from globalization, away from corporate control, away from central government control, away from homogenization, away from commercial banking control over wealth and credit, and away from the appalling unsustainability of credit-money at compound interest.
These trends are all good things; all things that could ultimately tend to the preservation of local values, and diverse human cultures and types, across the planet. I wish them well!
BANKRUPTING THE COUNTRY?: Many economists these days are expressing fears that the “stimulus” program and spending sprees of the regime in Washington could lead to severe inflation, “bankrupting the country.” They make a good case, but it’s a little confusing when they refer to bankrupting the country when really they’re referring to bankrupting the government. Bankrupting (and eventually totally discrediting) the government is certainly very bad for the government — but it might end up being very good indeed for the nation that throws off such government.
