a reply to: CookieMonster09
Since the GFC there has been more (not new) public notice of the fact that banks do not lend out their 'assets'..theyve been telling this us since
the 30's...i really dont know upon what facts anyone claims that banks are lending out their actual 'assets'....have you heard of fractional
reserve banking? In Australia, banks are no longer required to have reserves, but instead now operate under Basel III which requires a reserve of risk
weighted assets, but, they do not lend assets out. They make loans based on their 'right' to which has been granted to them by the people....this is
where money comes from..we the people granted the banks the right to extend credit to us...we MUST pay a fee for using this credit.
The problem with all this conspiracy crap is that when one person makes a claim (usually unsubstantiated and subjectively based) that does not gel
with another's belief, the latter calls them a conspiracy nut, while at the same time neither camp seems to do their own research...
The banks are doing nothing wrong, or illegal in the main..they do from time to time go beyond their powers and get greedy etc, and the Commonwealth
Bank in recent times regarding financial advice is one example...BUT...like every other corporation, Banks are 'mandated' to make profits..because
it is your retirement funds that have invested in them..if you dont like the fact that banks have their sole focus on profit, stop relying on them for
your loans, transactions, and your retirement.
The actual money system (unlike some old economists suggest) is not an real asset backed system but a financial backed system, and the main difference
between the two is that financial assets always have an equitable obligation attached....that is just the way the system operates today, and if used
properly is a good system...we use it improperly because of too much greed for one, and too much reliance on others (govt's and banks) and not enough
taking of responsibilities for ones own affairs and duties.
The facts are:
Banks do NOT lend out their assets, but 'extend credit' because they have been granted the 'right' to by we the people.
We must pay for the use of this credit extension for the simple reason that your use of this credit extension is an overall burden on society.
When banks make profits those profits are returned to the investors/stock holders.
If you have a retirement fund (superannuation..401 plans etc), then YOU more than likely are an investor in Banks.
Banks are operating for the benefit of the people in the long run and resemble a charitable trust...YES, CEO's get huge payouts, but that is because
they are paid (like every other manager of funds) in relation to the size of the capital/funds under their management...
Again, if you have retirement funds, then these CEO's are managing these funds on YOUR behalf...
So i'm sorry, but both sides of this argument are wrong...too much victim mentality on one side, and too much living in the dinosaur past on the