Money worries are paramount these days.  It has been said that most marriages that end in divorce are usually caused by financial issues more than personal issues.  I know in my own life, discussions about money in my household growing up were a nearly daily event.

Have you ever wondered why it seems to be nearly impossible to ever get ahead?  It seems that every year prices keep going up, goods and services get more and more expensive.  House prices soar and paycheck stay the same.

What this created by accident or on purpose?

The mechanics of money are intricate, so I won’t get into much detail about the monetary system in this post; however, I did want to cover an important aspect of the monetary system which I find interesting in terms of its ability to enslave people and countries.

Interests.

I’m sure you are familiar with interest. Maybe you have a credit card or have taken out a loan.  These loans are rarely given without interest being added to the original loan.  This has come to be known as the way banks and other financial institutions make their money — and we as people seem to have accepted that paying interest on money is acceptable, but has anyone ever stopped and thought about what is really happening?

Let me explain.

For matter of making this easy to explain let’s assume that there is only $100 in the whole world.  A ridiculous statement? Yes! But it makes it easier to explain how interest literally enslaves people and countries FOREVER.

Ok, so we have $100 in the whole world. And let’s say that a bank has $50 and the other $50 is in circulation and being traded for goods and services in the marketplace.  Everything is good so far.

Now, I go into the bank and take out a loan for say…$50.  To make this easier to understand I’ll say the bank charges me %50 interest on the loan, making the total amount I would need to pay back being $75 ($50+$25 of interest).  Now, I understand that %50 interest is a ridiculous amount, but for illustration purposes it makes it easier to explain.

Alright… so I borrowed $50 from the bank.  I go out in the marketplace buy some supplies and make gloves which I sell to people.  Let’s say that my gloves are so popular that I end up getting all of the $100 that is in world.

Are you with me so far?

So I go back to the bank pay them the $75 I owe them for the loan and keep my $25.  Now before leaving the bank I decide to take out another loan, this time for $75 which again is given to me at an interest rate of %50, therefore the amount I would need to pay back would be $75+$37.5 (interest) for a total of $112.50.

Question.

If there is only $100 in the world how on earth would I ever be able to repay the $112.50 that is now owed to the bank?

I can’t.

There isn’t enough currency in circulation for me to pay back the loan. So what happens now?

What happens at this point is more money would need to be printed and put into circulation.  But what happens to something when more is available.  The value of that something goes down because it is more easily available. This is economics 101.

Which means when more money is printed, the money that is currently in circulation including the new money being printed loses value.  Sure, a $20 bill still says it is worth $20, but in reality the “buying power” of this $20 bill has decreased, that is why prices continue to rise.

Prices don’t really go up —- it’s our money that is actually going down. So what use to cost $1 may now cost $2.  We are still using the same $1 bill to buy the product but instead of only needing one we now need two bills.

Why is this important to understand? Because our current money system is designed to keep people working….trying to make enough money to pay off their loans and debts.  But the reality is that there is never enough money in circulation to ever pay off ALL debts, thus it is impossible for everyone to be debt free.

And, because there is not ever enough money in circulation to pay back all the loans — more money needs to be printed from time to time making the money already in circulation worth less, thus prices increase making it harder to afford the basics.

Want to learn more? View this YouTube video.  You’ll never see this being taught in schools.

In today’s economy there is a lot of talk about a recession, downsizing, layoffs and people not being able to afford stuff due to job losses and outsourcing.

This all seems so silly to me.  The very concept of money is silly to me actually.  I once read a great quote that stated…..

“why are you making getting what you want a two-step process?”

What the author meant by this statement was, why are you working for money when you could work for the actual item you wanted re: bike, home, shoes….etc.

Than it dawned on me. The majority of people buy stuff not because they need it, but because they think they want it.  This wanting is influenced by a variety of variables including advertising.

Because people don’t truly know what they want, they figure that they want more money.  But the interesting thing is that, people don’t want money — after all, money is nothing more than a piece of paper with ink splattered all over it, it is basically worthless until we give it value by saying it has value.

What people do want, is what money can buy or can afford them. Maybe its the idea of freedom, a new home, that cool iPod or a night out on the town with friends. That is what people want. They want what money can buy.

Back to the question. Why do so many people make getting what they want a two-step process? Chasing after money instead of going after what they truly want?

I’d have to conclude that when it comes down to it….many people don’t truly know what they want. So they settle for thinking that it is money they want, but its is nothing more than a good old sleight of hand trick — they get money, and with the influence of advertising they spend it on things they thing they want… they go on feeling happy for a while, but because the items purchased are not what they truly wanted… the happiness ends quit abruptly and people are left feeling empty which in turn allows for the process to repeat itself … this time more easily.  When you feel empty or sad… it is much easier to advertise and convince you that a new widget can make you feel better, more confident, or more beautiful.