The House of Commons held a very important debate this last week on the creation of money, a process which the Big 4 banks have monopolised and thus privatised the money supply. The abuse of this power over the last 3 decades has been enormous, and I used this debate to propose an entirely different system which would remove this power from the present banking cartel in order to ensure that what was maximised was the national interest, not the banks’ own selfish interests. I said this:
“On lending to businesses, the experience that we have had in the past half-decade has been very unsatisfactory. Under a Sovereign Monetary System, however, the central bank would be empowered to create money for the express purpose of that funding role. The money would be lent to banks with the requirement that the funds were used for productive purposes, whereas lending for speculative purposes—for example, to purchase pre-existing assets, either financial or property—would not be allowed. The central bank could also create and lend funds to other intermediaries—the hon. Member for Wycombe referred to this—such as regional or publicly owned business banks, which would ensure that a floor could be placed under the level of lending to businesses, which would be a great relief to British business, guaranteeing support for the real economy.