Description of the Financial Ponzi Scheme

The Telegraph today features one of the best articles I have read, describing the problems we face today. The article is written by Darius Guppy, a former criminal, who who gives remarkable insight into the financial system.

Covering fractional reserve banking, Guppy notes that following the creation and destruction of money (via bank loans) - the interest earned stays in the system:

However, the point to be grasped is that while money is indeed created and destroyed in vast amounts every second of the day, the interest on that money remains un-destroyed and accumulates within the system – and at a compounded rate, moreover.

Having watched my earlier video on the exponential function, we know the power of this compounding.

For while that money, which by now has mutated into a vast mutual-indebtedness monster, grows exponentially, the wealth it is supposed to represent cannot grow at the same pace for very long.

Guppy compares our financial system to a giant ponzi shceme that relies on a system of continued growth:

Once that growth is threatened the edifice collapses.

Scarey stuff.  For more information on how the banking system works, I recommend watching “The Crash Course” - a series of You Tube videos details the problems outlined above and how we can prepare.