I’m pretty sure that most of you have been living ‘in debt’ for much of your lives, I certainly was.
Our whole society, our economy as well, are built on debt and credit.
It’s the biggest fraud and scam that many people are unaware of, and it is how banks and bankers become incredibly rich and wealthy themselves.
“You will own nothing and you’ll be happy” is the mantra spouted by the World Economic Forum as part of their “Great Reset” agenda. And this is how they do it.
Let’s start with a simple explanation first.
You have no money. You ask me to lend you £100. I agree to lend you this money from my wallet, on the provision that you pay me back £10 a month for the next 12 months, so you end up paying back £120 in total.
After 12 months, you’ve paid me £120, so I’m £20 better off as a result. This is what is referred to as ‘interest’. This is my ‘profit’ on the deal. It is therefore in my ‘interest’ if this money is paid back to me, which I guess is where the term comes from.
However, you still have only £100. If you have no other source of income, you can only ever pay me back £100. You”ll no doubt need to spend some of that £100 on other things, so that reduces the amount you have available to pay me back. If you end up not being able to pay me this money back, I lose the £100 that I gave you from my own pocket, money that I already had.
In a nutshell, many years ago, this was how banks used to work, they would lend money from what they had in reserve, whatever amount of gold etc they had stored away in their vaults. It was impossible for them to lend out more than they ever actually had.
So it was always the case that there was a ‘finite’ supply of money.
The introduction of “fractional reserve banking” changed all this however, and banks were allowed to ‘lend’ more than they actually had in reserve. And this is why we find ourselves in the ‘cycle of debt’ we are in now.
In my earlier example, I personally lent you money that I had and was mine. Here’s how this works today with modern banks:
You may ask a bank to ‘loan’ you money, whether that be to buy a house, a car, or whatever.
If you meet the criteria, and the bank agrees to the loan, all someone does is enter some numbers into a computer and just like that, you have that amount of money in your account. You then agree to pay the bank back a set amount per month, which will include ‘interest’ at a certain percentage.
The bank doesn’t necessarily have the funds on reserve to give you, they issue you a ‘credit’, which in turn creates ‘new money’. You then use this ‘new money’ to buy your house or your car.
There will of course be conditions attached to this providing of credit from your bank. We’ve all seen the notices on TV mortgage adverts that warn that “your home may be at risk if you do not keep up your repayments”.
And this is the trick: if you do end up ‘defaulting’ on your loan, the bank then has the right to seize control of your assets – in the case of mortgages, your property can become ‘repossesed’ and you end up kicked out of your home with nowhere to live.
Why is it a ‘trick’ though? Because the bank didn’t actually loan you any of ‘their’ money, they just ‘created’ new money out of thin air. And any money that you paid them back as part of your repayments, is money that they never had in the first place, it’s “new wealth” if you like.
Of course, by defaulting on your loan/mortgage, the bank also loses out on the potential ‘interest’ it would have earned on the deal..
However, on the other hand, if a bank conjures up £200k out of thin air to ‘lend’ to you to buy a £200k property, and you then default on your mortgage, through the process of ‘repossession’, the bank now acquires an asset worth £200k.
Let that sink in for a moment… the bank lends out ‘fictional’ money, and ends up with ‘tangible assets’. Even if the bank sells off the property on the cheap and gets £150k, the bank is still £150k up on the deal!
Debt slavery
Going back to what I said previously about a ‘finite’ supply of money, the introduction of fractional reserve banking has essentially created an ‘infinite’ supply of money.
The more money that is ‘created’ through the issuing of ‘credit’, the less likely it is that any of this ‘debt’ can ever be paid back in full, let alone ‘with interest’.
You can work your socks off working and earning money in order to pay off your debts, but then what happens when interest rates increase, meaning you have to pay even more?
I remember seeing the promotional adverts years ago from companies who offered the benefits of “consolidating all your debts into one convenient monthly payment”. It was one of those things that sounded like a ‘nice idea in principle’, but essentially all you were doing was taking on a new debt, in order to pay off your existing debts.
It seems like a good idea, but you’re still just juggling things around, and never likely to ever fully repay the debt you originally owed.
Can the cycle be broken?
I think it can, if you have the determination (and the patience), as well as the willingness to make significant changes to your lifestyle.
When I was younger, I had a couple of credit cards, as well as a catalogue credit account, which I would use to buy myself things, which I couldn’t otherwise afford at the time.
Starting out with a low credit limit, I found that the more I spent on my cards, the more the issuer would increase my limit. It became almost an afterthought, I didn’t have the money to buy stuff outright, I’d just ‘pay on the card’, and make monthly repayments.
The debt soon started to mount up, and I reached a point where the card issuer wouldn’t increase my credit limit.
I found myself at a point where I had two credit cards with large balances, and I couldn’t afford the monthly repayments. So I decided to take out a loan with a bank. The theory being that I could borrow a sum of money, pay off my credit cards, and then pay back the loan at a lower interest rate.
It almost worked to plan. Only I borrowed more than I actually needed. Yes, I paid off my credit cards, and then had a nice holiday somewhere with the rest. But the mistake I then made was to carry on using those credit cards.
Yes, I got myself into debt to pay off my debt, and then allowed myself to get even further into debt.
Trust me, this kind of strategy never works out.
It was only when I sat back and took a good cold hard look at my finances, that I realised I needed help and couldn’t do this by myself. I wasn’t earning enough to afford the repayments on the debt that I had.
To cut a long story short, I ended up signing up with a company and found myself taking out an Insolvency Voluntary Arrangement (IVA) – not quite the same as being declared ‘bankrupt’, but it meant that all my debts were ‘frozen’, and over a period of five years I paid an ‘affordable’ amount to my creditors, after which I was declared ‘debt-free’ and still am to this date. The remainder of my debt was ‘written-off’ as a result.
In my opinion, this is only possible because ‘debt’ is fictional, as lenders are lending money that they don’t have, all they lose is the ‘potential’ interest they may gain.
I learned a very harsh lesson at the time, and it has stayed with me ever since. While I have lived ‘debt-free’ for several years now, I aim to keep things this way. Granted the property I am living in currently is rented from a private landlord, however all of my possessions I currently have are ‘my own’, all of which I have bought with money I have personally saved up, nothing I have is ‘on credit’.
I may not own much, but what I do have is mine.
And at this point in time, I’m actually quite happy, thank you.
Continues in Part Two here:
