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#1
10-04-2007, 02:24 AM
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Why do governments borrow money?
Much of the global debt is in the form of governement debt - and this essentially is tax payer's debt.
Governments borrow money from banks who create that money out of thin air and charge the government interest on that loan. These banks are private banks and make huge profits for lending out something they basically create on a computer screen. If it is the government who give banks permission to do this, then why don't they just give themselves permission to do it, create the money themselves, and not pay interest? This would save tax payers $Trillions in servicing that debt. The only reason they do this (that I can think of) is to remove money and power from tax payers and transfer it to the big banks. After all, the big banks and bankers are more powerful than governments. 
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#3
10-04-2007, 03:14 AM
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Re: Why do governments borrow money?
[ QUOTE ]
If it is the government who give banks permission to do this, then why don't they just give themselves permission to do it, create the money themselves, and not pay interest? [/ QUOTE ] Is that what Germany did after WWI with such great success that in the end you needed a wheelbarrow full of money to buy a loaf of bread?
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#4
10-04-2007, 03:20 AM
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Re: Why do governments borrow money?
[ QUOTE ]
[ QUOTE ] If it is the government who give banks permission to do this, then why don't they just give themselves permission to do it, create the money themselves, and not pay interest? [/ QUOTE ] Is that what Germany did after WWI with such great success that in the end you needed a wheelbarrow full of money to buy a loaf of bread? [/ QUOTE ] How is it different if the governement borrows created money from banks and pays interest instead of money it creates itself and doesn't pay interest? Same result, cheaper method.
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#5
10-04-2007, 03:30 AM
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Re: Why do governments borrow money?
The government sells bonds to whoever wants to buy them, and they need to get paid for the bonds. You can buy bonds, China probably have tons of them, so does lots of local and foreign governments, insurance companies, pension funds and so on. The banks who buys those bonds need to have the money to buy them, pretty sure they are not getting them without paying.
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#7
10-04-2007, 04:34 AM
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Re: Why do governments borrow money?
[ QUOTE ]
[ QUOTE ] The government sells bonds to whoever wants to buy them and then they do steroids and hit a lot of homeruns. [/ QUOTE ] [/ QUOTE ] Lol?
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#9
10-04-2007, 05:31 AM
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Re: Why do governments borrow money?
I understood the Barry Bonds-reference, I just failed to see how it could be considered funny.
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#10
10-04-2007, 05:58 AM
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Re: Why do governments borrow money?
Man, can I get a little sense of humor on these political forums? I certainly chuckled at it.
But since I must: Irony, noun - the use of words to express something other than and especially the opposite of the literal meaning Here, 'bonds' are being referenced, but it's humorous because, though the original reference was talking about government bonds, he uses the word to reference a baseball player. Now, to me, the idea of the government selling a baseball player, in and of itself, is pretty chuckle worthy. That it was the same player who has so much controversy surrounding steroid use was just the icing on the cake. Or you could go the other way with it and imagine a government bond, all bulked out from steroid use, ala Barry Bonds, and hitting loads of dingers. While not as funny, to me at least, still of the humorous slant. Do you see now how it could be considered funny? Or is it just that you don't think it's funny?
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