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Old 11-20-2014, 04:09 AM
Danny B Danny B is offline
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Join Date: Oct 2012
Location: L.A. Ca.
Posts: 4,896
Moral Hazard

Regulatory capture has allowed the banks to privatize gains and load the losses on the public. They can't lose so, they just gamble bigger and bigger. Like shooting caged rabbits, they have no fear of retribution. So, who gave them that protection?
The faulty factor in the banking business equation is the ultimate lack of consequences or to express that another way: imaginary limitations granted to lender's and borrower's liabilities.

This is the fault of the state. How? If I privately lend the capital to a house purchaser and they default I suffer a loss - that focuses my mind as to the real risk and consequence. If my loans to borrowers were made with capital that I did not own but was nevertheless available to me as a result of, say, my substantial and consistent business cash-flow, that would be a risky business strategy, (but I could argue I was still not actually 'trading insolvently' because the loan I had made formed an asset on my balance sheet).

How could I take such a risk (knowing if my borrower defaults I cannot pay my liabilities)? Easily if I have a state registered Limited Liability company (Ltd Co) and I measure the potential for profit exceeds the value of my Ltd Co should this loan default and my company consequently go bust (be unable to pay its creditors). Most Ltd Co's do not see this sort of prospect as making commercial sense even with their directors enjoying Limited Liability protection because they do not see the potential for sufficient return against capital available and the prospect of risk as a viable equation.

Yet banks do expose themselves to this risk. Why? Because they can create almost as much money as they require so long as they are either receiving deposits at a sufficient rate, are re-financing loans or are able to enjoy interbank lending to fund the loans they are making. And then the full risk is ultimately mitigated because the central bank will act as 'lender of last resort' should their house of cards threaten to fall. Whilst the beneficiaries of central banks are hard to identify the guarantor is not: it is the state. But what actually is 'the state'? In this the state is a conduit for the power of the forced taxation of human society.

The only viable and moral solution is to remove the forced link between the productive, wealth creation, ability of human society and the financial indemnification of all types company owners for their losses - especially banks. Bank's owners will be very focused as to the risk they are taking when they see all their private property, past and future, is at risk. Bankers want the all the reward for themselves and YOU to take all losses. Bankers have used a succession of manufactured wars to indebt states to them and to force states to allow the grant of this present banking system. They have created repeated economic bubbles and
crashes to force the state to borrow more of the money they create via the permitted wizardry of fractional-reserve-banking.

I do not object to anyone creating any sort of money, including fiat currency if that business model can be made to work or independent central banks acting as lenders of last resort, or loss insurers, to other banking business. That is their business and the business of their customers. I just object to being forced into indemnifying these business' as though they are acting for the public or as if they are public bodies. End that relationship and a durable market for the publications of currency and all banking services will rapidly emerge without public liability.

Whilst we continue to have human society controlled and bled via a 'state' we continue to allow a means for the banking money power elites to tap-in to the life-blood of humanity, through the power of state taxation, for their own gains at the cost of all others. The only enduring protection is to end the state!

If every leader, political and corporate, was totally accountable for their each-and-every action the world would be a different and better place. For one thing: no sane person would leave themselves open to such liabilities. For another: nobody could legitimately rise to such a position because the potential liabilities would exceed anybodyís ability to atone.

Why is it that the vast majority think we need a world where the few are expected to operate in such capacities; roles which clearly far exceed any personís ability to atone. It is madness, it is the false paradigm within which the world is currently lost. It surely is one clear reason why people in such positions of power do, so frequently, abuse their office in so many ways; they know they never can be really called upon to atone for their actions.

A fellow who truly accepted full liability for every aspect of their tenure would have to act with great caution; but I fear persons of such qualities do not often rise to any such position.
EUbrainwashing: The State: An Inherently Psychopathic System.
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