Banning Usury will promote cryptocurrencies

[minor-transgression]

Why not ban Usury?

Before attempting to answer the question, I'll lay out a "best case"
for an economy. The USA has the best data, so it's the choice.

If the USA continues its present course, except that spending
on Defence and they somehow manage to keep the present trade balance
then I suggest the following outcomes in ten years time:
Wages and prices will double, there will be a ten percent increase
in population and in real GDP, and the national debt will increase
from $20Tn to 30Tn.

In real terms, defence spending halves, the trade balance halves,
and the US national debt falls by one third. Pensions and entitlements
increase in line with inflation, and employment remains near it's
present level.

While I expect things will turn out worse than that, if you want to
make a case for banning Usury, you'd best think of ways to improve
economic performance, because present economics relies totally on
the ability to charge interest. Bear in mind also, that when you
strip away things like the power to create debt, you may find that
things like GDP are no more substantial than the imaginings of a
collective delusion.

It seems to me that promoting cryptocurrencies, for example Bitcoin,
promotes the idea of a ban on Usury, because it would be difficult to
have one without the other. I'm keen to hear any views on why that
isn't a good idea.

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[pitham1]

Usury is not about not charging interest. It is ensuring that the interest charged is not exorbitant.
If you think of an interest-free, debt-free world, you are living in a fool's paradise. This is not going to happen, whether Bitcoin succeeds or not. There are always those who are in need of money and there will be others who are ready to lend for a small price. There is no case for "banning" the transaction between the two.

[odolvlobo]

It is possible to loan bitcoins with interest, so I don't see your point.

In my opinion, there is nothing wrong with interest. Having money now vs. later has value, and people are willing to pay for that value. People should be allowed to pay interest in order to obtain a loan.


Also, the term "usury" generally means charging an excessive interest rate, though in the past it meant charging any interest (perhaps because any interest was considered excessive).

[ikydesu]

I don't get it the point, what the thing usury related to cryptocurrency?
Look at lending section, there are a lot some usury/interest by load bitcoin, it's not affect to bitcoin itself.

And what the way if bitcoin banning usury, however people still not really familiar with bitcoin?

[merchantofzeny]

Would you lend out your money to strangers without interest? I don't think so. There was an opportunity cost for lending out your money, whether it's in fiat or bitcoins. People should be allowed to charge for interest for the money relieved them. Consumers can then decide whether they'll accept the terms and if not they can try talking to another lender.

[yayayo]

Interest is a concept that is deeply intertwined with the current inflationary fiat scam money system. If money would just keep its purchasing power or even increase in purchasing power like it is the case for precious metals and Bitcoin, expecting interest for just holding makes no sense. In the fiat scam system, interest and compound interest is a toxic force that demands ever increasing economic growth at any cost. People are enslaved because of interest and nature is destroyed by excessive resource usage just to fuel economic growth to be able to repay interest.

We don't need to ban interest. We just switch over to Bitcoin. Bitcoin is attractive, because it is not subject to interest-induced inflation. So it will be adopted in the terminal phase of the fiat scam we are experiencing today.

ya.ya.yo!

[botany]

There are 'islamic banking models' which exist today and which tell you they don't charge interest. They are actually work arounds and they end up charging the customer a lot more than a traditional bank. So force-banning something like interest just won't work. It will exist under another name.

[JariKriting]

Usury  not related cryptocurrencies
if all bank is baned and close because use usury system
poor country can die, because is PDB can't is develop in country,  must loan to world bank and another country G to G
all country can give loan without return is imposible can give loan

[chesatochi]

Interest is a concept that is deeply intertwined with the current inflationary fiat scam money system. If money would just keep its purchasing power or even increase in purchasing power like it is the case for precious metals and Bitcoin, expecting interest for just holding makes no sense. In the fiat scam system, interest and compound interest is a toxic force that demands ever increasing economic growth at any cost. People are enslaved because of interest and nature is destroyed by excessive resource usage just to fuel economic growth to be able to repay interest.

We don't need to ban interest. We just switch over to Bitcoin. Bitcoin is attractive, because it is not subject to interest-induced inflation. So it will be adopted in the terminal phase of the fiat scam we are experiencing today.

ya.ya.yo!

You have an excellent point here; the fiat currency lost his purchasing power every year. I think interest is fair if they charge only a right amount, and people have the capacity to repay.

In the case of bitcoin with the limited supply of coin in circulation, the price will stay stable.

[yayayo]

There are 'islamic banking models' which exist today and which tell you they don't charge interest. They are actually work arounds and they end up charging the customer a lot more than a traditional bank. So force-banning something like interest just won't work. It will exist under another name.

That is indeed true. My previous post should not be wrongly interpreted in regard that I would endorse Islamic banking. I do not endorse anything that is based on prohibition. I only endorse systems that provide for free choice of the individual.

To state it more clearly: The idea of "banning usury" to promote cryptocurrencies is a misconception. Cryptocurrencies will be successful exactly because of usury in the fiat system. It's free choice of market participants that will make Bitcoin successful - the possibility to choose a better system.

That said, you have to keep in mind that interest is only reprehensible as an embedded feature of the inflationary fiat slavekeeping mechanism we have today. When it comes to venture capital, interest is acceptable, because the risk taking of the creditor must be compensated.

ya.ya.yo!

[minor-transgression]

@Yo - "Cryptocurrencies will be successful exactly because of usury in the fiat system."

It seems most of history is against you, in that bad money always drives out good money,
and as far as I know, every paper currency has ended in inflation. So, somehow,
cryptocurrency to the rescue?

You have a fair point regarding prohibition. I'll ask you to define exactly you choices to
avoid the present system. Can you pay your taxes with, say, bitcoin?  It seems
prohibition is already in place, I merely suggest a different prohibition to make you
look at the options from a different point of view.

[yayayo]

@Yo - "Cryptocurrencies will be successful exactly because of usury in the fiat system."

It seems most of history is against you, in that bad money always drives out good money,
and as far as I know, every paper currency has ended in inflation. So, somehow,
cryptocurrency to the rescue?

You have a fair point regarding prohibition. I'll ask you to define exactly you choices to
avoid the present system. Can you pay your taxes with, say, bitcoin?  It seems
prohibition is already in place, I merely suggest a different prohibition to make you
look at the options from a different point of view.

I'm not sure if you really understood what I tried to express. I'm very much convinced that fiat currency will end in inflation. And that's exactly the reason of why Cryptocurrencies will become more and more attractive as a store of value. I think you're mixing concepts a little bit: Of course will people be eager to get rid of "bad money" and throw it on the market. But they will be interested to purchase "good money" (Bitcoin) with it. So history is clearly not against your or mine assessment of situation, because we have pretty much the same opinion.

The choices to avoid the present system are to reduce fiat use whenever possible. Governments will quickly become more willing to accept Bitcoin for tax payments, once they collect less taxes overall...

ya.ya.yo!

[Przemax]

Interest rates aka usury implies that the borrower will get more money from the economy than he had put it. If half of the people would borrow someone else money, from where the additional percent of the money would come? From heaven? Or from nowhere because it is impossible.

 Interest rates and not printing new money leads to a complete disaster and lack of money. Sorry bitcoiners to burst your bubble but if the world would to be financially stable it cannot and will not use only bitcoins.

[odolvlobo]

Interest rates aka usury implies that the borrower will get more money from the economy than he had put it. If half of the people would borrow someone else money, from where the additional percent of the money would come? From heaven? Or from nowhere because it is impossible.

The flaw in this oft-repeated fallacy is that it ignores the fact that money is a medium-of-exchange. Value is produced and consumed in an economy. As long as borrowers can produce enough value, loans can be repaid. It doesn't matter if there is a finite amount of money -- money is a tool used to exchange value. A loan can potentially be paid back using the same dollar over and over again.

[minor-transgression]

quote
I  personally don't believe Usury is the problem.  Usury is just the price of credit -- everything having a proper price is OK as long as the market is not manipulated by state power.

The problem is the state power that artificially cheapens credit over the long term, to benefit the elites who issue debt.  When too much debt is issued, whose value is then supported by all kinds of manipulative and deceptive actions like inflating other bubbles and starting military adventures, we have problems.

In a constant-money-supply world, prices would just go down as real wealth accumulates.  Economic growth would be fuelled by credit, on which there would be no limit.  (The key here, again, is that credit be totally market driven -- any state intervention would create distortion and bubbles.)

The Great Fear of deflation that has been pounded into the minds of modern economists only applies to this world of centrally planned money.  Since too much money and credit have been created (from artificial, state-driven demand,) the economy has been distorted.  People have honed their skills and made investments based on the financially (artificially) inflated world that demands a lot of luxury for the rich, etc.  Once the bubbles are so big that market forces wake up and wipe out asset values, this demand disappears immediately and people lose jobs and savings.

Since the constant-money-supply world doesn't have the major man-made distortions to start with, asset value corrections would be minor in their impact and actually healthy for the economy.
unquote
@BobK71 - I have a problem with the morality of Usury. Usury can create a situation where
the borrower is unable to ever make good on the debt. Legally, the law is on the side
of the Lender, but that tends to encourage excessive risk taking. This seems wrong
from both a moral (and a technical) point of view.

I reach a diametrically opposed view on credit creation. Credit flows from it's source
to a sink, be that bankruptcy or discharge, and wealth provides the reverse circulation.
If anyone could set up a bank, and or print their own money, this would be less of a
problem because there would be competition to provide loans in various formats, much
like today's altcurrencies. The problem begins with the creation of a legal monopoly
on the printing of money. There seems to be some jumps in your logic where your
intermediate steps need to be validated before your conclusions can be reached. I
suspect your solutions only apply in a very narrow set of prior conditions.

We need to talk more about the constant-money-supply, but let's take one step at a time.

[minor-transgression]

@Yo - The land of the Underpants Gnomes seems not too distant ...

1. Hyperinflation of, inter alia, the US Dollar, turning the world into Zimbabwe
and Venezuela.

2 ...

3. Profit!!! (Cryptocurrencies to the rescue!)

Step 1 _requires_ the loss of faith in the ability of a government to govern, and
a loss of control the supply of money leading to excess quantities of money in
circulation. There are prior conditions necessary for that to happen. It is also
possible that money flows into banks as interest, while unemployment soars, and
prices fall. Generally speaking governments never lose control, they just impose
mistakes. Following that logic, I see no reason to suppose that hyperinflation
must happen in the western economies anytime soon (even in the Euro area).

Logically, there seems no reason for Central Banks setting interest rates near
zero. The large quantities of debt on their books increase the sensitivity of the
systems to shocks and to any other changes. This increases risk within the system,
hence unless the Central Banks have good reason to believe they can control outcomes,
interest rates should be increasing to compensate depositors for the risks they face.

The problem is that the population at large, and many who post on these boards
are too trusting of banks, politicians, and governments. They promise "growth"
whereas they mean debt expansion providing profit to the few. This can continue
until the pockets of the savers are completely empty and the bankruptcies begin.

[buwaytress]

Really good points brought up here. The reason usury is fundamentally wrong is that lenders expect guaranteed returns when risk - and gain - should be shared by both lender and borrower.

Profit sharing or dividends systems are somewhat better, of course with more weight on the lender or investor. Though to me, since the borrower is the one with effort and lender only capital, even equal share of profit/loss is very fair.

[davis196]

Why not ban Usury?

Before attempting to answer the question, I'll lay out a "best case"
for an economy. The USA has the best data, so it's the choice.

If the USA continues its present course, except that spending
on Defence and they somehow manage to keep the present trade balance
then I suggest the following outcomes in ten years time:
Wages and prices will double, there will be a ten percent increase
in population and in real GDP, and the national debt will increase
from $20Tn to 30Tn.

In real terms, defence spending halves, the trade balance halves,
and the US national debt falls by one third. Pensions and entitlements
increase in line with inflation, and employment remains near it's
present level.

While I expect things will turn out worse than that, if you want to
make a case for banning Usury, you'd best think of ways to improve
economic performance, because present economics relies totally on
the ability to charge interest. Bear in mind also, that when you
strip away things like the power to create debt, you may find that
things like GDP are no more substantial than the imaginings of a
collective delusion.

It seems to me that promoting cryptocurrencies, for example Bitcoin,
promotes the idea of a ban on Usury, because it would be difficult to
have one without the other. I'm keen to hear any views on why that
isn't a good idea.

What is Usury?I`ve never heard about this.

Paper money and central banks mean only one thing-debt.

All the world economies are addicted to debt.They need debt to maintain economic growth.

Are cryptocurrencies the solution?

[Fortify]

You making a post about "banning usury" on an internet forum means absolutely nothing and isn't really worth a discussion. This is what banks and money lenders do. Of course companies offering exorbitant rates like pay day loans should be restricted, but since the beginning of time it has been around and it will continue long after you are dead. It sounds like you are trying to push the Muslim way of banking, they're welcome to it but the West has arguably been way more successful without it.

[erre]

You can not ban usury, but with bitcoin you can "ban" fractional reserve, and that's MUCH MORE important