[ExI] Micro-loan programs not as successful as hoped

[Dan]

I think this is the main issue here. I doubt many microlenders are creating new 
money. Central banks and other established banks under the current system do 
create new money, but my impression is microlenders merely lend out of their 
existing money stock and don't create any new money stock to back loans or 
deposits.

And my point was merely that there's nothing wrong per se with charging interest 
on loans. One might criticize either fiat money or fractional reserve systems, 
but that's entirely separate from the issue of charging interest on loans. Also, 
further, there's no objective, scientific way to say that freely agreed upon 
interest rates (or any other prices) are too high or too low. (Of course, we 
live in societies where there's massive manipulation of interest rates and other 
prices, though, to my knowledge, microlenders are not part of the 
manipulation and seem to represent a way of dealing with current credit systems. 
I think complaining about them is merely misguided at best or so much 
demagoguery at worst. In this case, it's notable that politicians and government 
economists are doing the complaining -- not the borrowers serviced by 
microlenders. To me, this is typical of much anti-market rhetoric: the people 
actually involved are not complaining -- just outsiders who seem to either not 
have a clue or who actually are just looking for an issue to grandstand on.)

Regards,

Dan


From: Samantha Atkins <sjatkins at mac.com>
To: ExI chat list <extropy-chat at lists.extropy.org>
Sent: Wed, November 24, 2010 1:43:02 PM
Subject: Re: [ExI] Micro-loan programs not as successful as hoped


On Nov 23, 2010, at 6:38 AM, Stefano Vaj wrote:

> 2010/11/22 Dan <dan_ust at yahoo.com>:
>> Basically agreed. When people complain about a price being too high or too
>> low (in an uncoerced setting*), they demonstrate a misunderstanding about
>> how prices work. None of these claims hold up under scientific scrutiny.
> 
> OTOH, money need not be supplied "for a price", let alone after having
> been produced out of thin air by some private entity.

Money is a value token.  Creating it without value debased it thus indirectly 
taxing all holders of money.  

The word 'supplied' may hide the fact that new tokens of value are being created 
out of thin air with no new value 

to back them up.  Nor is this theoretical.  From 1910 to today the US dollar 
lost over 95% of its purchasing value
largely through inflation of the money supply.  Since the current economic 
crisis began the US has apparently
effectively doubled the money supply.  It is not hitting the markets in mega 
inflation because so much is tied up in interest bearing (!?) bank reserves with 
the Fed.  But I would look for at least double digit inflation not too many 

years from now.  

- s


      
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