There is a lot of confusion about the role interest plays in the current monetary system. It is often suggested that the fundamental problem is not the banking sector’s ability to create money, but the idea that “banks create the money to make the loans, but don’t create the money to pay the interest on those loans”.
Eight people now own more than half the world's population. This terrible statistic lurks behind many of the world’s worst troubles. How has it come to be?
At the moment, give or take a bit of quantitative easing, all money is conjured into existence by private banks, 85% of it as loans on existing residential property. It’s a recipe for unaffordable housing and unmanageable private debt, but it’s also undemocratic; writes Zoe Williams in the Guardian, 9th January 2017.
Do you know how money is created and gets into the economy?
What’s wrong with our financial system? Chief Economics Commentator of Financial Times explains. (Video)
In just 4 minutes Martin Wolf, Chief Economics Commentator of the Financial Times, clearly states point by point what is the problem with our current financial system and how we can fix it: