I am in the same situation - and I guess most bankers are, too.
I guess it’s not only about bookkeeping - it’s about the promised rights to consume raw materials, services, products and the use of land and hands in the future.
So it’s about trust. Will the debitor be able to fullfill it’s promise to the creditors ?
The promise beeing for example to deliver not only 10$ but the right to consume a tripple whopper at burger king - to name an internationaly fixed value - and with that the right to parts of a cow, hands and places and services involved etc.
For many debitors today the answer would be - no. So the creditors don’t ‘invest’ anymore but in direct values like land or basically needed businesses (warren buffets train deal).
There’s no possibility at all to run a system based on returning 20% interests - because after a brief time the debitors had to promise the earth and the moon.
So the promise has to be diluted by inflation (owe you 10$ + interest but I will increase the ammount of money in a way you won’t get more then a diet coke) - taxes have to be payed on revenues from capital lending - interests had to be paid on money.
The later failed as an instrument to regulate the balance between debt and credit if I see it correctly. And that had to do with political influence on Mr. Greenspan.
Yes.
I know, for a fact, the Federal Reserve has failed, many many times. It basic charter is contradictory. To protect the value of money, AND low unemployment. And to supply money. The value has dropped, according to some, 99 percent. We have had much unemployment and money supply has gone from flood to bust.
Like housing with HUD/Urban Renewal it has failed, save in the case of the Fed, to give a lot of jobs to dorctoral economists who sing it tune, the most famous case being Greenspan.
I think the world will want to have a new type of money, separate from government control, a partial gold backed to start.
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Yes investors are getting shafted. They won’t get support until the workers pension investments get hurt, which they are already. The masses not only don’t care, they dislike, investors, only of course until their checks don’t show up.
I think for a long time we were in a period of growing trust. Now we are in a period of declining trust.