Paul Grignon: Money as Debt (animated documentary)

“The process by which banks create money is so simple that the mind is repelled.”

John Kenneth Galbraith

 

This animated documentary is an eye-opener, showing how the debt-based system of money creation works. Canadian film-maker Paul Grignon’s explanation about how money is created using the system of fractional reserve banking, the ratio between bank reserves and actual deposits, is not as accurate as it seemed when it was first presented to the public some years ago. Also, as a solution, Grignon proposes interest-free banking and a continuation of fiat currency (money created out of thin air), albeit by government decree rather than at the behest of private banks.

Most of us have no pretensions to being able to understand in any detail the complexity underpinning national and world economics or finance (and maybe that, as much as anything is the root cause of the present malaise), but with the banking system undoubtedly in turmoil and even the economists showing little sign of understanding, or being able to explain to the public, what is going on, perhaps we need to hear about alternative viewpoints.

If this 45-minute documentary were to be watched by more people and discussed (and debunked where necessary), we would all have a better understanding of why the banking system, as it stands today, is unsustainable. I’d love to read Larry Elliott of the Guardian’s take on it for example. Money as Debt II: Promises Unleashed released in 2009, deals with the 2008 banking crash and Money as Debt III, due to be released later this year, promises to offer solutions to the present crisis.

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