First Cafe Economic event is a discussion on:
‘Money: what is it, how it’s created and why it’s become such a problem?’
Introduction by Brian Davey (ecological economist and member of Feasta).
Date and Time: Thursday 30th June at 7.30pm
Entry: Free/ donation
Contact: briadavey AT googlemail.com
Location: Hopkinsons Tea and Coffee Bar (formally Art Org), 21 Station Street
(the street runs parallel alongside Nottingham railway station)
Few people realise how money is created. 97% of the money in circulation is deposits, created by banks when they lend – with a few computer keystrokes. Ordinary people are not allowed to create money – that would be counterfeiting. However, banks can and do – most money creation was privatised long ago. But, if a substantial proportion of the debt which backs the money goes bad, then the deposits in the bank are backed by nothing. Then we, the taxpayers, usually end up rescuing the banks. Were we not to rescue the insolvent banks the payment system on which we all depend would fall apart. That would be chaos.
In simple versions of economics money is a described as a medium of exchange, and the textbooks tell how it facilitates the buying of goods and service in the “real economy”. However, money accumulation has become the purpose of exchange, an end in itself. By lending money to make money, by the exchange of currencies and by speculation on anticipated trends in commodity prices, as well as on expected exchange and interest rates, the financial sector has become dominant. Now, instead of banks and finance houses servicing the economy, the economy exists to service the financial markets. Giant financial institutions have more power than states. Inequality and environmental destruction is increasing exponentially and democracy itself is on the line. The tail is wagging the dog. Where will this all lead? Come along and discuss this crucial topic.