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Author Topic: USURY is it good or bad or neutral ?  (Read 5271 times)
RodeoX
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July 05, 2012, 03:52:44 PM
 #21

Nothing wrong with borrowing and lending. Unless you believe the Bible, in which case it is an abomination and one of the worst sins against God that can be committed. 

The gospel according to Satoshi - https://bitcoin.org/bitcoin.pdf

Free bitcoin=https://bitcointalk.org/index.php?topic=1610684
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July 05, 2012, 03:56:44 PM
 #22

I would argue that the fundamentals of our current economic malaise rest in it being legalised and bought into general use.

And you would be wrong. That would be like saying guns are responsible for world violence, which is incorrect. Guns may certainly have an influence on the amount of world violence, but they are not the source. And of course violence is possible without guns.

So too would be our economic troubles without usury. The real source of our economic problem is debt as a basis for economic growth coupled with unsound (inflationary) money.
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July 05, 2012, 04:16:04 PM
 #23

Usury (the practice of charging interest on lending money) was illegal almost everywhere and morally frowned upon until the middle ages (see a play by a little known English author  "William Shakespere!" called The Merchant of Venice) . I would argue that the fundamentals of our current economic malaise rest in it being legalised and bought into general use. Whilst not suggesting it be banned again-wishing to avoid legal and contractual problems at least in relation to bitcoin (a new economic approach) should it not be discouraged and considered morally reprehensable again? discuss. reg.
I think the moral issues don't stem from the practice of lending money itself.  I don't see any issue with that (and there are good arguments already in this thread of why it's in fact essential to an economy).  The moral issues are related to what you allow as collateral for a debt and what happens in the event someone is unable to repay a debt.  For example, I'd argue that it's immoral to allow a person to be enslaved when they cannot repay a debt.  Few people would probably disagree…however, the question of what constitutes enslavement is not so straightforward.  Lenders will just have to factor into their risk model that they cannot turn someone into a slave in the event they don't repay their debt.

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July 05, 2012, 04:44:12 PM
 #24

Bitcoin addresses the inflation and debt interlinking that fiat has but you can still have HTC denoted loans so it doesn't address the usury problem.

Usury has its roots in religious leadership but I'd like to see a more scientific look at debt.

When I ask some people they sometimes say 'its just greed'. I don't accept that as a full explanation at all.
I believe that debt creates a different acting network and that network flows with natural bias. A business operating in gold and credit is a completely different thing to a business running in fiat and indebted to a bank. The business indebted is not answering to the government, but to the bank. the gov answers to the bank, not the other way round.

Religions have all insurrected against this effect in different ways. In Christianity Jesus went bat shit crazy in the money changing house so the Romans gave the death sentence, then we had a terrorist martyr.

the network is massive and it can seem like there is no escape. but if you trade your service for btc you've immediately
 freed yourself from the system and if things collapse around you that can carry on.

The whole thing happens again and again throughout history and its been going on since before the Egyptians. why ignore it? why not study it?

I don't believe debt creates wealth I. the long term. i believe overall it enables corruption and inefficiency. by creating a network and linking it to herd mentality all you do is create flow from which we can profit or loss by prediction, overall a destructive process. don't be fooled by those who try to direct your attention into certain isolated parts of the flow.
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July 05, 2012, 04:45:51 PM
 #25

I think the moral issues don't stem from the practice of lending money itself.  I don't see any issue with that (and there are good arguments already in this thread of why it's in fact essential to an economy).  The moral issues are related to what you allow as collateral for a debt and what happens in the event someone is unable to repay a debt.  For example, I'd argue that it's immoral to allow a person to be enslaved when they cannot repay a debt.  Few people would probably disagree…however, the question of what constitutes enslavement is not so straightforward.  Lenders will just have to factor into their risk model that they cannot turn someone into a slave in the event they don't repay their debt.

The negative views toward usury stem from two things: 1) a misunderstanding what economic impact it can have, and 2) the question of its morality.

My comment above shows how it mistakenly becomes a sort of scapegoat for economic problems. As for morality I personally don't like usury, but don't have any problem with its use. The only time it becomes a moral issue for me is when the percentage charged ventures too high. I'd wager most would agree with that on a sliding scale. For me "too high" is anything over about 20%. But 1%, for example, wouldn't register as immoral to me at all.
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July 05, 2012, 05:09:20 PM
 #26

Did you know that the earth receive more energy from the sun then we receive in one year?

Did you know that some asteroid in outer space contains at least 1 trillion dollars worth of precious metals?

Also, economic growth isn't always about using more resource. It can be that we get more out of the current resource we have.

Please participate in my recent thread entitled 'Resources'. Your simplifications indicate a certain ignorance that desperately needs to be corrected.
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July 05, 2012, 06:33:42 PM
 #27

Usury (the practice of charging interest on lending money) was illegal almost everywhere and morally frowned upon until the middle ages (see a play by a little known English author  "William Shakespere!" called The Merchant of Venice) . I would argue that the fundamentals of our current economic malaise rest in it being legalised and bought into general use. Whilst not suggesting it be banned again-wishing to avoid legal and contractual problems at least in relation to bitcoin (a new economic approach) should it not be discouraged and considered morally reprehensable again? discuss. reg.
wasn't it only immoral for christians and muslims to charge interest, and it was ok for jews to charge interest to non jews.

I think you labor under a false premise.

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July 05, 2012, 07:23:51 PM
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Usury (the practice of charging interest on lending money) was illegal almost everywhere and morally frowned upon until the middle ages (see a play by a little known English author  "William Shakespere!" called The Merchant of Venice) . I would argue that the fundamentals of our current economic malaise rest in it being legalised and bought into general use. Whilst not suggesting it be banned again-wishing to avoid legal and contractual problems at least in relation to bitcoin (a new economic approach) should it not be discouraged and considered morally reprehensable again? discuss. reg.
wasn't it only immoral for christians and muslims to charge interest, and it was ok for jews to charge interest to non jews.

I think you labor under a false premise.

it would only be a false premise if what I said was wrong. however a closer reading points out that the play I mentioned directly addresses this exact point. So we are both correct in fact. yes it was ok for jews to lend to non jews but not other jews since they considered themselves christians ie; the chosen people. However I am not familiar with inter religious views and cannot argue reliably but at this low level of economic activity usury was not of itself harmful. however returning to my point, generating interest from lending money grew to such a large extent it became debt. As has been pointed out this is why we are in trouble now. Making debt morally acceptable causes a posative reinforcing model of economics dependent upon growth. Nowadays we wonder how states propose to solve their indebtedness by guess what- borrowing more money at greater rates of interest. My point again- isn't living well beyond any reasonable assessment of our means on debt morally reprehensible? reg
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July 05, 2012, 08:10:09 PM
 #29

Usury (the practice of charging interest on lending money) was illegal almost everywhere and morally frowned upon until the middle ages (see a play by a little known English author  "William Shakespere!" called The Merchant of Venice) . I would argue that the fundamentals of our current economic malaise rest in it being legalised and bought into general use. Whilst not suggesting it be banned again-wishing to avoid legal and contractual problems at least in relation to bitcoin (a new economic approach) should it not be discouraged and considered morally reprehensable again? discuss. reg.
wasn't it only immoral for christians and muslims to charge interest, and it was ok for jews to charge interest to non jews.

I think you labor under a false premise.

it would only be a false premise if what I said was wrong. however a closer reading points out that the play I mentioned directly addresses this exact point. So we are both correct in fact. yes it was ok for jews to lend to non jews but not other jews since they considered themselves christians ie; the chosen people. However I am not familiar with inter religious views and cannot argue reliably but at this low level of economic activity usury was not of itself harmful. however returning to my point, generating interest from lending money grew to such a large extent it became debt. As has been pointed out this is why we are in trouble now. Making debt morally acceptable causes a posative reinforcing model of economics dependent upon growth. Nowadays we wonder how states propose to solve their indebtedness by guess what- borrowing more money at greater rates of interest. My point again- isn't living well beyond any reasonable assessment of our means on debt morally reprehensible? reg
yes, living well beyond any reasonable assessment of our means on debt is not a good thing to do. Does that mean charging interest on money lent should be morally reprehensible and/or not done in general practice?

no.

One reason for this is that it is possible (not only that, it is easy) to live within your means and take on debt.

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July 05, 2012, 08:41:03 PM
 #30


 Debt does allow for more complex human interactions, even to the point of a hive mind greater than the 120 person limit that we have in tribal setups. 

If considering humans as machines, capable of perfect double entry accounting, there is no problem.

However, there are a so many of cognitive errors that debt is involved in.

Addiction & the inability to calculate compound interest are just 2 problems. Are there any here that aren't related:
http://en.wikipedia.org/wiki/List_of_cognitive_biases ?

Putting a readied syringe next to a recovering heroine addicts bed... well they have a choice don't they, but it's not nice, no?

 The whole debt thing has it's roots in religion way back from year dot.

The other thing I'd say is that having the debt contract open ended is also bad. That is, if you write a contract, the end of term should be clear. With debt as we have today it's a rolling percentage. 2 strikes of bad luck and how do you keep up? Years ago you could take these people as your slaves, or their daughters. Now after a lot of bloodshed (what people don't appreciate), we now have the bankruptcy, insolvency process to stop people killing each other over it. What if the contract was clearer from the start (if X, than Y) so that if it hasn't been paid back in X years then the collateral is taken and the saga is over.

Also, debt is the mechanism of war. Looking at many wars we can see an element of it. Germany's debt WWI & WWII, Napoleon, the US civil war, the kings debt in the British civil war, it's everywhere.
Today we're on a GDP growth treadmill where we have to work harder and harder to avoid war.

Is it really worth it?

I would much prefer to get away from morals and argue mechanisms but that just doesn't seem to work. Talking about how it's killing everyone and putting everyone at loggerheads with everyone at least puts us on the same page. "I, as debtor wish to reconcile with my debtee, we are both the victims of the same problem"


I'd like to see a lot more talk of psychology, network theory and the history of debt in this thread, talking like engineers solving a problem rather than pontificating labeling arm chair politicians.
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July 06, 2012, 04:28:38 AM
 #31


Absolutely not. Interest is the price of money.


This amounts to saying that the unit of mass we call "gram" has to have a known mass, or that the word "inch" has to be written in certain  length. Money is what we use to measure value, just like we use inches to measure length. In both cases it helps us compare and exchange things more easily.

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July 06, 2012, 04:49:13 AM
 #32

Absolutely not. Interest is the price of money.
This amounts to saying that the unit of mass we call "gram" has to have a known mass, or that the word "inch" has to be written in certain  length. Money is what we use to measure value, just like we use inches to measure length. In both cases it helps us compare and exchange things more easily.

Well, aside from the fact that having a known mass for "gram" is vitally necessary for proper scientific measurements, what he was saying is that it's not the price of money, per se, but of lending, ie, getting money. Islamic banking refuses interest, going on a "If you appreciate this service, pay what you want" model. It seems to work pretty well, but even though they don't call it interest, it basically is, just with the borrower setting the terms, instead of the lender.

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July 06, 2012, 03:16:10 PM
 #33

Absolutely not. Interest is the price of money.
This amounts to saying that the unit of mass we call "gram" has to have a known mass, or that the word "inch" has to be written in certain  length. Money is what we use to measure value, just like we use inches to measure length. In both cases it helps us compare and exchange things more easily.

Well, aside from the fact that having a known mass for "gram" is vitally necessary for proper scientific measurements, what he was saying is that it's not the price of money, per se, but of lending, ie, getting money. Islamic banking refuses interest, going on a "If you appreciate this service, pay what you want" model. It seems to work pretty well, but even though they don't call it interest, it basically is, just with the borrower setting the terms, instead of the lender.

Perhaps I wasn't clear: it's like saying that the unit of mass (an abstract concept) has to have a known mass. See, it is such a silly idea when you apply it to mass or length or color or anything else, yet most people are brainwashed into being comfortable with the same idea when it comes to money. They don't even stop to think for a moment before talking about the "price of money". What would you think of someone telling you "sorry, can't continue building this house, I'm out of inches"?

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July 06, 2012, 03:21:49 PM
 #34

Absolutely not. Interest is the price of money.
This amounts to saying that the unit of mass we call "gram" has to have a known mass, or that the word "inch" has to be written in certain  length. Money is what we use to measure value, just like we use inches to measure length. In both cases it helps us compare and exchange things more easily.

Well, aside from the fact that having a known mass for "gram" is vitally necessary for proper scientific measurements, what he was saying is that it's not the price of money, per se, but of lending, ie, getting money. Islamic banking refuses interest, going on a "If you appreciate this service, pay what you want" model. It seems to work pretty well, but even though they don't call it interest, it basically is, just with the borrower setting the terms, instead of the lender.

leaving religion out i have used this service and only repaid what i borrowed. admittedly a small amount for a short period. it  was a social service and appreciated- however the lender got more back than lent because of appreciation which is not interest!. given BTC limit and potential  increased usage would this not always be the case and does this not avoid usury and limit gain to increases in BTC exchange rate? reg
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July 06, 2012, 03:30:25 PM
 #35

leaving religion out i have used this service and only repaid what i borrowed. admittedly a small amount for a short period. it  was a social service and appreciated- however the lender got more back than lent because of appreciation which is not interest!. given BTC limit and potential  increased usage would this not always be the case and does this not avoid usury and limit gain to increases in BTC exchange rate? reg

Why would I lend you money (with dollars or BTC) if I got the same or less back?  There's just no incentive.  Interest is the incentive.  Although not necessarily the case with fiat currencies, BTC/gold will appreciate w/o me lending it out & risking not getting it back.  Interest is how I offset the risk that you won't pay me back.  If you have a good credit score, I can charge less interest because I will most likely get my money back.  If you have a bad credit score, I can charge a lot of interest because the changes are greater that you won't pay me back.  It is basic economics.  There is nothing negative about it.  If I get a new job far from home & can't afford a car, it is beneficial for me to borrow the money for the car because I will still net a profit after paying the interest.  The lender will also benefit because they will get more than they lent out back.

The only reason to limit the block size is to subsidize non-Bitcoin currencies
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July 06, 2012, 04:38:48 PM
 #36

leaving religion out i have used this service and only repaid what i borrowed. admittedly a small amount for a short period. it  was a social service and appreciated- however the lender got more back than lent because of appreciation which is not interest!. given BTC limit and potential  increased usage would this not always be the case and does this not avoid usury and limit gain to increases in BTC exchange rate? reg

Why would I lend you money (with dollars or BTC) if I got the same or less back?  There's just no incentive.  Interest is the incentive.  Although not necessarily the case with fiat currencies, BTC/gold will appreciate w/o me lending it out & risking not getting it back.  Interest is how I offset the risk that you won't pay me back.  If you have a good credit score, I can charge less interest because I will most likely get my money back.  If you have a bad credit score, I can charge a lot of interest because the changes are greater that you won't pay me back.  It is basic economics.  There is nothing negative about it.  If I get a new job far from home & can't afford a car, it is beneficial for me to borrow the money for the car because I will still net a profit after paying the interest.  The lender will also benefit because they will get more than they lent out back.

yes, with fiat you would certainly get the same or less back because of QE and similar schemes. But with BTC over the last few month at least you would have got more back. For you "interest is the incentive" not altruism as is another approach! Risk is the criteria that causes most worries. That is why current systems need KYC or similar. However you are not opposed to a good credit score and within an anonymous system that may be the answer. But repeating an example of the current systems operation where everyone is charging each other interest and everyone wins is simply disingenuous because look where we are now? reg 
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July 06, 2012, 05:48:55 PM
 #37

yes, with fiat you would certainly get the same or less back because of QE and similar schemes. But with BTC over the last few month at least you would have got more back. For you "interest is the incentive" not altruism as is another approach! Risk is the criteria that causes most worries. That is why current systems need KYC or similar. However you are not opposed to a good credit score and within an anonymous system that may be the answer. But repeating an example of the current systems operation where everyone is charging each other interest and everyone wins is simply disingenuous because look where we are now? reg 

Altruism only goes so far.  Interest & credit scores allow you to trust people you don't know (or care about).  And the gaining value of BTC is a moot point because I could just not loan you out the money & still receiving that gain in value.  But above all of that, I don't think interest is the root of our financial problems.  In fact, I think the FED's control over interest rates is a large reason for the problems we have today.  Too low, risky lending.  Too high, not enough lending.  Both cause problems & both are caused by someone setting the rate instead of the market place.

The only reason to limit the block size is to subsidize non-Bitcoin currencies
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July 06, 2012, 06:00:29 PM
 #38

In fact, I think the FED's control over interest rates is a large reason for the problems we have today.  Too low, risky lending.  Too high, not enough lending.  Both cause problems & both are caused by someone setting the rate instead of the market place.

Exactly. Let the market decide what the true cost of getting money is (and to the Islamic banking proponents, I would point out that the customer is part of the market), and we will have the right amount of lending, at the right rates.

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July 06, 2012, 09:58:20 PM
 #39

The concept of "usury" is just plain ignorant. People are free to contract - period.
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July 06, 2012, 10:01:19 PM
 #40

Gabi
Also on wiki i read money lending exist since the Roman Empire

Yes thank you for that. Again my point is (to coin a phrase) "money is the root of all evil". as we know all empires have so far fallen. The attempt in the early middle ages to curb usury may well have been in reaction to the devastation caused by the fall of the roman empire.  I know money lending will not stop because if you have a little more than you need right now why go and earn more by your own labor when you can lend at interest and get someone else to labor for you? I just can't see it as being morally justifiable! reg.

the love of money is the root of all evil..... money is not evil but to lust for it is where the fail is...


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