May 2017 Positive Money New Zealand issued a press release seeking clarity from the Reserve Bank on how our money is created.  They still refer to intermediation by the banks, which is not how our banking system works.

5th November 2016 An article in The Guardian newspaper in England argued that abolishing debt-based currency holds the secret to getting our system off its addiction to growth.

5th September 2016 KPMG released a report, commissioned by the Prime Minister of Iceland, titled "Money Issuance" The report looked at money created by the Government.

28 March 2016 Bryan Gould has agreed to be the Patron for Positive Money New Zealand.

Bryan is a respected commentator on economic matters, an author, academic and Companion of the New Zealand Order of Merit.

31 October 2015 A monetary reform group in Switzerland has enough signatures for a referendum on who creates their money supply.

14 October 2015 The Finance Commission of the Dutch parliament discussed monetary reform.

31 March 2015. The Telegraph in London reports on the Icelandic governments plan to have their central bank issue their money supply and calls it a radical plan.

22 November. The British parliament debated money creation last week, for the first time in 170 years. There was cross-party support for a proposal to set up a monetary commission

23 September. A new generation of young people, dubbed ''property orphans'' may be destined to be renters for life.

17 September. The Bank of International Settlements (BIS), the bank used by central banks, confirmed New Zealand houses are among the most "unaffordable" in the world compared to people's incomes.

6 September. Bruce Bisset of Hawkes Bay today reveals the true story behind the so called Rock Star economy.

25th April 2014 "Strip private banks of their power to create money”: says the Financial Times’ chief economics commentator Martin Wolf, who endorses Positive Money’s proposals for reform

15th March 2014 - In a historic move The Bank of England quarterly bulletin explains how money is created. Whenever a bank makes a loan, it creates a deposit in the borrower’s bank account, thereby creating new money. The bank says that this differs from the story found in some economics textbooks.

16th August 2013. The retiring head of the Financial Markets Authority apologised for the mistakes made saying “You were let down”.


“The banks do create money. They have been doing it for a long time, but they didn’t realise it, and they did not admit it. Very few did. You will find it in all sorts of documents, financial textbooks, etc. But in the intervening years, and we must be perfectly frank about these things, there has been a development of thought, until today I doubt very much whether you would get many prominent bankers to attempt to deny that banks create it.”

H W White, Chairman of the Associated Banks of New Zealand, to the New Zealand Monetary Commission, 1955.

Unearned Money

Marc Joseph

In his book Money: Whence It Came, Where It Went, the famous economist John Kenneth Galbraith wrote  "The process by which money is created is so simple, the mind is repelled." Indeed, it is very difficult to grasp at first. However, once money creation is seen and understood clearly the private banks' position becomes indefensible. Let's look at the process from another angle.

People understand that when they borrow money from a friend or a relative, they are borrowing that person's hard-earned money so of course they feel a genuine obligation to repay the loan. Unfortunately, people think the situation is identical when they borrow from a bank. But it's not.

The bank credits the borrower's account with brand new money by tapping a keyboard and changing the number in their account. This new money is not someone else's hard-earned money, it's unearned money produced with virtually no effort. However, the borrower's only source of money to repay this loan is to go out and earn it. And interest charges add insult to injury with the banks demanding even more than they printed. This is an extraordinarily unequal relationship. We are all aware of the time and effort society expends in paying off loans from banks. Imagine if the borrower was aware of the process, would they agree to enter into this debt servitude? Probably not.

In other words, the banks continue to operate because people just don't know. The banks have fostered their image as intermediaries between savers and borrowers but it simply doesn't stand up to scrutiny. In this age of information and the internet it is easy for money reformers to point out the truth about banking and the Positive Money website is one of the best resources to recommend. Ask your friends to visit the site and watch the videos. Let's work together to bring an end to debt servitude.

Change money, change the world!





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