When Both Ends Crash: The Reality Of a Quantitive Economy, using money that isn’t real

What most people don’t seem to get is that the vast majority of major companies over the last 25years to go under have gone under because of massive debts.

They got these massive debts off the bankers giving loans to companies with no sureties other than the pension funds of these companies and cash flow forecasts.

These banks loans were made from money the banks just didn’t have in the first place, but the banks already had that covered, they invested in many companies they knew to be going down the pan.

The con really was simple, take a big company that is in trouble like Woolworths….. (ill set up simple maths here)

Woollies need a loan to help pay the wages of minimum wage paid workers, lets say a £1.5 million pounds to cover all the bills for that month.

The banks don’t actually have £1.5 million in cash at the local high street bank to move from their account to the woollies account, so they just write IN WORDS, £1.5 million pounds into the woollies account.

When Woolworths actually default on the payment the bill becomes a debt.

Now Woolworths have to find £1.5 million REAL pounds to pay back the DEBT of £1.5 million NOT REAL pounds.

Are you starting to understand how this works now??

That is why our country is crashing from the House of Frasier to Pound land…… half of our whole REAL economy is held up by not real money….

About the author

The Gaffer

View all posts