Why Do We Pay Interest On Borrowed Money?
April 21, 2009 by Caro · Leave a Comment
Is there a way we can pay for our basic needs - a home, fridge, TV and car - without having to pay back the principle and interest on our purchase?
Interest is the price we pay for the money we borrow. Those who lend us the money see themselves as giving up the advantage of having that cash – the liquidity advantage of money - so they charge a percentage on the principal loaned to us to compensate themselves for losing the benefit of having the cash to use.
So interest creates money for the lender without their actually producing anything for it. According to some thinkers, charging interest, or usury, violates natural law.
The Value of Money
March 29, 2009 by Caro · 6 Comments
In March, 2009, co-host of CNBC’s The Call, Larry Kudlow, lit a U.S. dollar note, destroying part of it. He claimed that the burning dollar represented the value of our money.
Kudlow was introducing a segment on the U. S. Government’s new Term Asset-Backed Loan Facility and he said that the program - aimed at energizing the asset-backed securities market that subsidizes loans to consumers and businesses - would result in “a lot of people lighting flame to the U.S. dollar which is going down in flames.” http://thinkprogress.org/2009/03/19/kudlow-burns-money
Did he really believe that the burning note was in fact, burning money?
Modern money is not really a thing at all; it’s just an agreement made between us all, that makes it real.
