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Eliminate exponential growth Population/Finance
Eliminate exponential growth Population/Finance
by Overlyhonest » Tue 20 Dec 2005, 05:44:10
If paying interest was eliminated worldwide would that negate the need for a growing population?
If I wish hard enough this problem will go away!
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Re: Eliminate exponential growth Population/Finance
by Doly » Tue 20 Dec 2005, 08:59:23
$this->bbcode_second_pass_quote('Overlyhonest', 'I')f paying interest was eliminated worldwide would that negate the need for a growing population?
That's an interesting question. I imagine you are referring to the fact that economic growth looks like it requires a growing population, and that growth looks like it's driven by the need to repay interests.
Let's look at the two issues separately:
1) Does economic growth require a growing population?
My opinion is that it doesn't require it, but our current growth is partly fuelled by growing population, and it would be hard to keep it at the current pace with a stable population. The detailed analysis is written in one of my posts in the thread "Where does growth come from?" But my opinion is not an expert opinion.
2) Is growth driven by the need to repay interests?
Again, this is my opinion. Growth is driven by the fact that all companies in a capitalist state try to make a profit. If most companies are to make a profit successfully, the total amount of money has to be constantly growing. Interest is part of the reason a company tries to make a profit. If you have to repay your loan, you will need profits to repay it. But companies try not just to break even and repay their loans, they try to make a profit above that. And let's not forget that banks are companies as well, and when they make a loan they're making a profit. That is, banks aren't just breaking even and paying with the interests the salaries of their employees plus the cost of defaulted loans that are never recovered.
If banks were to become non-profit organizations, but the rest of companies were still profit-making, growth would still be necessary. If all companies turned into non-profit organizations (that's exactly what a guy called Karl Marx suggested, but his ideas have been twisted in all directions since he wrote them), there would be no need for growth.
Once again, this is my non-expert opinion. If anybody knows better, please correct me.
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Re: Eliminate exponential growth Population/Finance
by MrBill » Tue 20 Dec 2005, 11:08:38
$this->bbcode_second_pass_quote('Overlyhonest', 'I')f paying interest was eliminated worldwide would that negate the need for a growing population?
If paying interest was eliminated there would be no mechanism for current savings to pay for future investment. Therefore there would be no growth. People would still have sex, which is what drives population growth. The poorest man in Africa would still have his 10-15 children for religious, cultural or reasons of status to care for him in his old age because he did not invest his savings in interest bearing instruments to pay for his retirement, so he is on a pay as he goes system, hopeing his children will bear this burden. If sex was eliminated worldwide that would stop popoulation growth and less econonic activity would be required to provide for the remaining populations basic needs. No people. No problem with peak oil.
The organized state is a wonderful invention whereby everyone can live at someone else's expense.
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Re: Eliminate exponential growth Population/Finance
by hotsacks » Tue 20 Dec 2005, 14:38:03
Money is a symbol too long unquestioned.
What does the symbol represent,in plain language?
Does it represent:fairness,equality,promise and hope,security,longevity,or any of a host of positive values?
Or does it represent:enslavement,cunning,injustice,inequality or any of a host of negative values?
The meaning of money could be changed with relative ease.The meaning of interest is another matter.
Mr Bill points out that interest is a necessary tool for growth.We are aware that growth is a dangerous proposition in our present situation.Perhaps it's time to scrap the whole debit/credit model,severely curtail interest rates,and force fiscal policy to think in terms of other horizons than short term profit.As much as economists defend the current system as the most efficient means of capitalizing progress,it is more and more difficult to justify the real world results of such efficiency.
If we are to survive,monetary policy has to change.Interest on capital is a free lunch philosophy that has gotten us into this mess.
What does the symbol represent,in plain language?
Does it represent:fairness,equality,promise and hope,security,longevity,or any of a host of positive values?
Or does it represent:enslavement,cunning,injustice,inequality or any of a host of negative values?
The meaning of money could be changed with relative ease.The meaning of interest is another matter.
Mr Bill points out that interest is a necessary tool for growth.We are aware that growth is a dangerous proposition in our present situation.Perhaps it's time to scrap the whole debit/credit model,severely curtail interest rates,and force fiscal policy to think in terms of other horizons than short term profit.As much as economists defend the current system as the most efficient means of capitalizing progress,it is more and more difficult to justify the real world results of such efficiency.
If we are to survive,monetary policy has to change.Interest on capital is a free lunch philosophy that has gotten us into this mess.
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Re: Eliminate exponential growth Population/Finance
by bantri » Tue 20 Dec 2005, 18:43:48
IMO, currently, the status quo is a system based on the laws of finance.
but, in this system, it´s possible to create infinite amounts of currency using a very small amount of energy in the form of printed paper, or doing electronic transactions.
as energy starts to become scarce, that system will become more linked to the laws of physics instead.
once this fact becomes widely accepted what will happen is predictable:
energy will become the currency, and then, it will have all the physical properties related to it.
forms of currency that require energy to be extracted will become more valuable than the common currency, like gold for example, it requires energy to be extracted and it´s value doesn´t grow magically like electronic numbers.
even so, it doesn´t respect some physical laws, like the one that states about eficiency, this law states that, when energy passes through any system, some of it is lost in the process, and never recovered.
by using this way of thinking, it´s also predictable that sooner or later we will have a system where the value of currency (electronic maybe) decays in time, which represents a more rational aproach (by linking finance with physics).
trying to maintain financial growth simultaneously with energy fade, leads to an impossible solution, and this can create unpleasant oscilations in the market.
they can both grow or fade but, they can´t follow in opposite directions.
the sooner this fact can be widely accepted, the better, delaying it will only lead to the appearance of chaotic market behaviors like hyper-inflation or sudden asset value losses which will only worsen the consequences.
but, in this system, it´s possible to create infinite amounts of currency using a very small amount of energy in the form of printed paper, or doing electronic transactions.
as energy starts to become scarce, that system will become more linked to the laws of physics instead.
once this fact becomes widely accepted what will happen is predictable:
energy will become the currency, and then, it will have all the physical properties related to it.
forms of currency that require energy to be extracted will become more valuable than the common currency, like gold for example, it requires energy to be extracted and it´s value doesn´t grow magically like electronic numbers.
even so, it doesn´t respect some physical laws, like the one that states about eficiency, this law states that, when energy passes through any system, some of it is lost in the process, and never recovered.
by using this way of thinking, it´s also predictable that sooner or later we will have a system where the value of currency (electronic maybe) decays in time, which represents a more rational aproach (by linking finance with physics).
trying to maintain financial growth simultaneously with energy fade, leads to an impossible solution, and this can create unpleasant oscilations in the market.
they can both grow or fade but, they can´t follow in opposite directions.
the sooner this fact can be widely accepted, the better, delaying it will only lead to the appearance of chaotic market behaviors like hyper-inflation or sudden asset value losses which will only worsen the consequences.
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Re: Eliminate exponential growth Population/Finance
by jaws » Tue 20 Dec 2005, 19:35:26
You cannot abolish interest. Interest is a natural outcome of human behavior. If you make it illegal, interest will go to the black market.
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Re: Eliminate exponential growth Population/Finance
by hotsacks » Tue 20 Dec 2005, 20:05:43
$this->bbcode_second_pass_quote('jaws', 'Y')ou cannot abolish interest. Interest is a natural outcome of human behavior. If you make it illegal, interest will go to the black market.
and economic growth would slow,curtailing environmental damage and population growth.
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Re: Eliminate exponential growth Population/Finance
by JohnDenver » Tue 20 Dec 2005, 20:39:32
Islamic banking functions without interest. All sorts of sophisticated financial services are available in a non-interest context. Even Citibank has an Islamic banking branch:
http://www.citiislamic.com/ciib/homepage/
I'm not an expert on the subject, but it appears that the system is not that different from conventional banking. The main difference seems to be that financing is done through equity-like investment, rather than bonds. You can't profit simply by providing funds. All investors must bear risk.
Regarding the thread topic, the elimination of interest in Islamic countries doesn't appear to have any affect on population trends.
http://www.citiislamic.com/ciib/homepage/
I'm not an expert on the subject, but it appears that the system is not that different from conventional banking. The main difference seems to be that financing is done through equity-like investment, rather than bonds. You can't profit simply by providing funds. All investors must bear risk.
Regarding the thread topic, the elimination of interest in Islamic countries doesn't appear to have any affect on population trends.
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Re: Eliminate exponential growth Population/Finance
by jaws » Tue 20 Dec 2005, 21:22:08
$this->bbcode_second_pass_quote('hotsacks', '')$this->bbcode_second_pass_quote('jaws', 'Y')ou cannot abolish interest. Interest is a natural outcome of human behavior. If you make it illegal, interest will go to the black market.
and economic growth would slow,curtailing environmental damage and population growth.
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