In this video on BBC News which has rapidly gone viral around the internet, the remarkably honest independent trader says:
‘Over the next 12 months the savings of millions of people is going to vanish and this is just the beginning.’
‘The governments don’t rule the world. Goldman Sachs rules the world. Goldman Sachs does not care about this rescue package – neither does the big funds.
‘I would say this to everybody who is watching this – this economic crisis is like a cancer… get prepared.’
Fractional reserve banking pretty much guarantees that the banking sector will always be unstable. It’s a business model that encourages banks to be as risky as they possibly can be – they have to walk on a “knife edge” between “being too risky and going insolvent” and “being not risky enough and losing their own profit”.
One of the basic ideas of capitalism is that money will be naturally channeled to the most productive use – in other words, the best business idea or most talented entrepreneurs. But by allowing banks to create the nation’s money supply and then distribute it as suits them best, this principle is completely undermined.
We now have the situation where only 25% of lending goes to business and the productive sector. The banking sector is failing to fulfill its supposed role in a capitalist economy. The existing banking system is completely flawed.
The only real solution to all our current problems is to prevent banks from creating money.
Unless we change the system very radically right now, this market trader will be right and the next years will be very miserable.