LETTERS:Banks and capitalists have got us into this financial mess

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For decades I have heard the parrot squawk that the socialists will take us back to the 70s, even after the 2008 banking crisis demonstrated that we were always in far more danger of being taken back to the 1930s by the capitalists – and we still are. The latest parrot to squawk this is London mayor, Boris Johnson.

Listening to Tories, you would think there was nothing wrong with the capitalism they worship which has caused economic havoc in the world.

As for Blairite politicians, they prefer to keep quiet about it and only talk about how they got themselves elected. Their only economic idea was to embrace this unbridled capitalism and play around with the tax coming in from a fake boom which was caused by banks being allowed to flood the world with unsustainable credit.

Some politicians still refer to the boom as the “good times when the sun is shining”. They were disastrous and deluded times when households, businesses, and governments set their budgets to a false economy and then found they weren’t sustainable when the boom went bust.

Some politicians and economists talk about getting the economy back to “normal” and “back on track”, giving the public the impression that there is an economic model that actually works and which they understand. These are the people who didn’t see a major economic crisis coming.

A world full of economists and politicians sat and watched the world being flooded with ridiculous amounts of credit when anybody’s old granny could have told them you can’t live on credit.

It is often the case that people of average intelligence have more sense than clever people who are lost in a maze of complex thought and deluded by the potency of own mental creations.

And there is nothing more delusional than the complex fantasy world of fake money and false values that is present economics.

Years before 2008, I used to write to this newspaper warning of corrupt capitalism, imbalance in the system and socially irresponsible house prices out of control.

What I didn’t know was where all the money in the system was coming from.

Some of us may remember our parents saying “Money doesn’t grow on trees”. I recently heard a politician say “We don’t have a magic money tree.”

Actually, we do, because the economic system is based on banks plucking magic money from an imaginary money tree and lending it as credit.

When people borrow money, they think they are borrowing real money that banks have.

In fact, banks just punch a few numbers into a computer and call it money. It’s called fractional reserve banking. I would call it the biggest con trick in history.

We are in debt to private banks for money they lent us which they never had in the first place! Plus interest!

When I started work in the 60s, we had physical money in the pay packet. I assumed all money was made by the Bank of England, and that they had some idea of value and knew how much to create in order to keep its value. It was obvious they couldn’t just create unlimited amounts. Yet it turns out that private banks are allowed to create money out of thin air and flood the world with it. So how can there be any gauge of value? Now, most money is electronic and only a few percent is physical.

Search great quotations on banking and you will see that great men of history warned about letting banks create money, including US presidents like Abraham Lincoln, who said governments should create and issue money.

Gordon Sanderson

Roughbirchworth Lane, Oxspring, S36