The creation of money has been a contentious issue, with deceptive lending by banks. In essence banks conjuring funds out of thin air to “lend” to borrowers.

“Is it possible in these days of disbelief in physical miracles really to caricature institutions which pretend to lend money, and do not lend it but create it?
And when it is repaid them, de-create it?
Who have achieved the physically impossible miracle thereby, not only of getting something for nothing, but also of getting perennial interest from it?”
– Professor Soddy. physicist. Oxford University.

These practices of deceptive lending by banks violate fundamental human rights and contravene legal statutes, constituting acts of counterfeiting and money laundering.

“There can be no doubt that all deposits are created by the banks.”
– Lord Keynes, Bank of England board member.

“Bank credit is a peculiar feature of a highly organised market economy. A commercial bank can also create credit, and hence money. When a commercial bank lends money, it sets up a checking account in the name of the borrower for the amount of the loan, thereby substituting its own credit for that of the borrower.”
– ‘Encyclopaedia American’, Grober. U.S.A., 1989. p.166.

Banks Create Money

“It is not unnatural to think of the deposits of a bank as being created by the public… Through the deposit of cash representing either savings or amounts which are not for the time being required to meet expenditure.

But the bulk of the deposits arise out of the action of the banks themselves. For by granting loans, allowing money to be drawn on an overdraft or purchasing securities, a bank creates a credit in its books, which is the equivalent of a deposit”

(report from Committee on Finance and Industry, a.k.a “Macmillan Committee” (1931), p. 34).

Banks have no tangible assets of their own to lend and all their “assets” are “paper assets” which are mainly in the form of “receivables” created by them out of “thin air.” These are derived out of loans whereas the monies loaned out were also created out of thin air.

“Although most writers still confuse and underestimate the matter, banks certainly create credit, or more exactly, they create money.”
Dr. Jim Cairns, former Treasurer of Australia. ‘Oil in Troubled Waters’, Widescope, Melbourne. 1976. pp.51-71.

“In this case money is created through bank credit.”
Joseph Martin, ‘Management of the Australian Economy’, University of Queensland Press, 1979. pp. 32-33.

What Do Banks Lend?

Banks lack the actual funds to lend, operating without the necessary reserves or authorisation from depositors. Instead, they create “paper assets” and “receivables” through bookkeeping entries, essentially fabricating money where none existed before.

“A bank can create credit for use by its customers by issuing additional notes or by making new loans which in their turn become new deposits. The amount of credit it extends may considerably exceed the sums available to it in cash.”
Encyclopaedia Britannica. ‘Banks and Banking’, pp.600-601.

These practices involve deceptive lending by banks, where customers are led to believe they are accessing credit or money. In reality, they are only receiving digital entries in their accounts. This “electronically created money” imposes burdensome interest obligations on borrowers for funds never physically disbursed.

How Banks Create Money

“Commercial banks differ from other financial institutions in two ways :
(1) they offer a wider range of services than the others
(2) they create money.

The power to create money arises from the public’s acceptance of a cheque written on a commercial bank as money. It is this public acceptance that turns it into money.

If a person goes to a bank to borrow money, the bank will have him or her sign a loan agreement that gives the loan, and indicates that he or she now owes the bank a stated sum.

The bank then adds the sum borrowed to that person’s bank account.

All that the bank has done is state that the person has more money in the bank”
The Macmillan Family Encyclopedia, Macmillan London Ltd, ‘Banking, 1980.

“Banking is little more than book-keeping. It is a transfer of credit from one person to another. The transfer is by cheque. Cheques are currency (not legal tender). Currency is money.”
Sir Edward Holden. British banker.

“The business of banking, consisting of the creation and transfer of credit, and making of loans, the purchase and disposal of investments and other kindred activities, is part of the trade, commerce and intercourse of a modern society.”

‘Commonwealth Law Reports’, 1947, volume 79, pp. 632-633. Judicial Committee of the Privy Council. London

Deceptive Lending

These deceptive lending transactions by banks constitute counterfeiting and money laundering… In that the source of money, as a new deposit into the borrowers’ accounts, cannot be traced. With no explanation of it’s origin. Nor any evidence of the accounting process.

Consequently, borrowers pay exorbitant interest rates for funds that never tangibly received.

Moreover, the lending process is fraudulent, with banks providing no real equity or value to borrowers. In instances of default, are foreclosure proceedings unlawful? Creating unjust enrichment of banks at the expense of borrowers’ property rights.

In essence, the contention lies in the creation of money out of nothing, perpetuating a cycle of deceptive lending practices and unjust enrichment for banks, while burdening borrowers with illegitimate debt obligations.