The Newcastle Journal has published an excellent article written by David Cook on money creation, debt and Positive Money reform proposals on Friday 21st March.

Here’s a short extract:

The Government say we need to get the banks lending again. Actually that’s the last thing we need. Lord Adair Turner, Chairman of the Financial Services Authority has remarked: “We got into this mess because of excessive creation of private credit and money; we should be concerned if our only escape route implies building up a future excess.”

We need to look at what money is, where it comes from, and where it goes.

The organisation Positive Money points out that 97% of our money has been created out of nothing when banks make loans. It’s incorrect to think banks are intermediaries between savers and borrowers. Only 3% of our money (coins and bank notes) has come from the Bank of England.

You can read an online version of the article in full here