WHAT IS MONEY?
Definition: Money is an “in-process promise to complete a trade over time and space”
Proof:
Examine trade: (1) Negotiation; (2) Promise to deliver; (3) Delivery.
In simple barter exchange in the “here-and-now”, (2) and (3) happen simultaneously, on the spot. Any exchange of “value for value” (e.g.corn for piglets; gold or gold backed exchange for other stuff; etc.) is in this category and does not involve money.
Money enables simple barter exchange over time and space. Thus, money is obviously “a promise to deliver”. It can be nothing else. It doesn’t exist before the promise is made nor after delivery is made”.
Money is only created by traders (like you and me buying things over time). It is not created by banks nor the governments they institute. In fact, “all” governments are just traders. But unlike you and me, they never deliver on their trading promises which create money. They just roll them over. And that is DEFAULT. And purposeful DEFAULT is COUNTERFEITING.
Banks sustain themselves on tribute collections (and all your tax payments go to the banks as tribute collections). Governments sustain themselves on counterfeiting. You give them sustenance through the INFLATION their counterfeiting generates.
We have never had a proper Medium of Exchange (MOE) process. But it is trivial to institute one. And anyone, or any group of traders, can create a “proper” MOE process. And multiple processes can co-exist and compete (by minimizing costs).
DESCRIPTION OF A PROPER Medium of Exchange (MOE) PROCESS:
The trader sees clear to make a trade over time and space and chooses to create “money” to effect the trade. For example, you or I choose to trade 360 monthly payments for a house, which we can take possession of and live in now and over the whole term of the promise and beyond.
The trader gets his promise “certified” (now bankers make you come hat-in-hand begging for what they fictitiously call a loan “of their capital” … that’s the scam). “Certification” means the trader’s identity and the terms of his promise are recorded and performance on the promise are transparently displayed to all lookers.
The certificates … first in the form of a simple ledger entry that creates the money and then transfers it to the seller … then circulate as the most common object in “virtually” every simple barter exchange. We know it as money (it may be a ledger entry; coin; or currency … but only one at a time).
The dollars we use everyday come from a “nearly proper” MOE process run by the banks and their “association”, the Federal Reserve. It has a leakage goal (i.e. INFLATION) of 2% and delivers 4% INFLATION on average. It gives its members privilege to create 10x as much money as they have … earning 4%x10 or 40% annual return … doubling “their” money in less than two years. Thus “a capitalist is simply two years”.
“A proper” process monitors performance on the promise (e.g.: did the trader make his monthly payment). If he did, all is well in paradise. If he didn’t, the process “immediately” makes an INTEREST collection of an amount equal to his DEFAULT … reclaiming the money as if he paid it back. This guarantees perpetual perfect balance of the supply and demand for the money … it guarantees perpetual zero INFLATION.
The operative relation is: INFLATION = DEFAULT – INTEREST = zero.
Who pays the interest? Non-responsible traders do. An existing well known model is the Mutual Casualty Insurance Company. Here INCOME = PREMIUMS – CLAIMS = zero. The money is made on the investment income and works to reduce premiums actuarially. Another distinction with the money process is that “all” members of the insurance group pay PREMIUMS. With a proper MOE process, responsible traders (i.e. traders like you and me who never DEFAULT) experience zero INTEREST load over the duration of their promise.
Note: For any given money creating trade, no money exists “before” the trading promise is certified, nor “after” final delivery (delivery returning the money which is then destroyed). And since “all” money is created in this way, “all” money in circulation is an “in-process promise to complete a trade over time and space”.
With a “proper” MOE process, banks are “competed” out of existence. A “proper” MOE process could be instituted right now (unless the governments they institute outlaw it) and banks would have to change or go out of business. And since INFLATION is perpetually zero, the governments “must” sustain themselves only on tax and fee collections. They cannot counterfeit. Irresponsible traders are drummed out of the marketplace.
What could be simpler and more obvious?
What hoax could be larger than that leveled on virtually all of us by the banks and the governments they institute?
Why did WTC7 fall down?
# Comprehensive Analysis: MoneyDelusions.com Economic Claims
The website MoneyDelusions.com presents a radical critique of modern monetary systems that **fundamentally misrepresents established economic theory and contains multiple factual inaccuracies**. While touching on some legitimate concerns raised by heterodox economists, the analysis promotes fringe theories without credible backing and makes demonstrably false claims about banking operations.
## Source credibility raises immediate red flags
The website’s **anonymous authorship and lack of verifiable credentials** severely undermines its credibility as an economic authority. No identifiable author, academic affiliations, or peer-reviewed publications could be found. The site promotes extreme Austrian School monetary theories that have been largely rejected by mainstream economics, presenting them as definitive truth rather than contested perspectives.
The anonymous nature is particularly concerning given the bold claims made about economic fundamentals. Legitimate economic analysis requires transparency about the author’s expertise and methodology, neither of which is provided here.
## Core monetary theories lack empirical foundation
The website’s central claim that “**INFLATION = DEFAULT – INTEREST = zero**” is fundamentally incorrect and contradicts basic monetary economics. This formula inverts the actual relationship between interest rates and inflation. In reality, central banks typically **raise interest rates to combat inflation**, not lower them. Paul Volcker’s successful campaign against 1980s inflation—raising rates to nearly 20% to combat 15% inflation—directly contradicts this theory.
The definition of money as an “in-process promise to complete a trade over time and space” oversimplifies money’s complex functions. Established economic theory recognizes money’s roles as a **medium of exchange, store of value, and unit of account**—concrete functions measured and tracked by central banks through money supply metrics like M1 and M2.
## Factual claims contain significant errors
Several specific claims made on the website are factually incorrect:
**Banking profits are grossly exaggerated**. The claim that banks earn “40% annual returns” is false by a factor of four. US banking industry Return on Equity averages **approximately 10%**, not 40%. This error suggests either misunderstanding of banking operations or deliberate misrepresentation.
**Inflation performance claims are inaccurate**. While the Federal Reserve does target 2% inflation, the assertion that it “delivers 4% inflation on average” is wrong. Historical analysis shows inflation has averaged approximately **2.7% since 2000**, and the Fed actually struggled to reach its 2% target consistently, often running below it until recent years.
**Reserve requirements are outdated**. The claim about 10x leverage through reserve requirements ignores that **the Federal Reserve eliminated all reserve requirements in March 2020**. The theoretical “money multiplier” the website describes no longer functions as presented in outdated textbooks.
## Government debt characterization misleads readers
The characterization of tax payments as “tribute collections” to banks misrepresents debt ownership. **Banks hold only a small portion of US government debt**. The largest holders are the Federal Reserve, foreign governments, and US private investors including mutual funds and pension funds. Interest payments go to all bondholders, not just banks, and represent contractual obligations on borrowed funds.
The claim that governments “never deliver on their trading promises” contradicts the **US government’s perfect debt repayment record**. The United States has never defaulted on its obligations and maintains high credit ratings, making Treasury securities among the world’s safest investments.
## Connection to legitimate economic criticism
Despite its flaws, the website does connect to some legitimate concerns raised by **heterodox economic schools**. Austrian economists like Murray Rothbard did critique fractional reserve banking, and Post-Keynesian economists question conventional monetary policy effectiveness. Modern Monetary Theory advocates challenge traditional views of government fiscal constraints.
However, even sophisticated versions of these alternative theories differ significantly from the website’s claims. **Legitimate academic work in monetary economics is empirically grounded and peer-reviewed**, unlike the speculative theories presented here. The website appears to represent a simplified, extreme interpretation of Austrian School thinking without the nuance found in serious academic work.
## Conspiracy theory elements undermine credibility
The website’s conclusion with “Why did WTC7 fall down?” explicitly connects monetary theories to 9/11 conspiracy theories, further undermining its credibility as a serious economic analysis. This association suggests the content may be driven more by **conspiracy thinking than rigorous economic analysis**.
## Conclusion: Advocacy masquerading as analysis
MoneyDelusions.com should be treated as **ideological advocacy rather than authoritative economic analysis**. While questioning established economic systems can be valuable, this website presents demonstrably false information, misrepresents basic economic relationships, and lacks the transparency and rigor expected from credible economic analysis.
Readers seeking understanding of monetary systems should consult **peer-reviewed academic journals, established economic institutions like the Federal Reserve, and identified experts with verifiable credentials** rather than anonymous websites promoting fringe theories. The legitimate debates about monetary policy deserve serious engagement with evidence-based analysis, not the speculative claims found on this site.
MD: Below is the typical comment I get:
Can you be more specific about the content of your article? After reading it, I still have some doubts. Hope you can help me.
It’s obviously just spam and in 8 years I haven’t been able to stop it. So I can’t manage comments and reply to them. I was in the process of cleaning over 150 such comments when I accidentally tripped over yours… because it was so long. So I’m going to take the time and respond to it in my typical fashion… via interspersed comments that retain the context in which they are made. So here goes: My comments are the typical MD:… form
=====================================
# Comprehensive Analysis: MoneyDelusions.com Economic Claims
The website MoneyDelusions.com presents a radical critique of modern monetary systems that **fundamentally misrepresents established economic theory and contains multiple factual inaccuracies**. While touching on some legitimate concerns raised by heterodox economists, the analysis promotes fringe theories without credible backing and makes demonstrably false claims about banking operations.
MD: Re. “radical” is a charged term. When the obvious truth is “radical”, we may have a problem. Re. “modern”… that adjective seems to be increasing in appearance. It evidently is supposed to serve the argument like words like “established” do. Re. “hetrodox”… now that’s a new one. Re. “fringe”, that’s a common one. Re. “demonstrably” without demonstration, a common one. Re. “banking operations”? Want to ennumerate them? 10x leverage advantage is all you need.
## Source credibility raises immediate red flags
The website’s **anonymous authorship and lack of verifiable credentials** severely undermines its credibility as an economic authority. No identifiable author, academic affiliations, or peer-reviewed publications could be found. The site promotes extreme Austrian School monetary theories that have been largely rejected by mainstream economics, presenting them as definitive truth rather than contested perspectives.
The anonymous nature is particularly concerning given the bold claims made about economic fundamentals. Legitimate economic analysis requires transparency about the author’s expertise and methodology, neither of which is provided here.
MD: I invented a game once. As long a people didn’t know I invented it, they played it with enjoyment. Once they knew I invented it, they wanted to re-invent it. I am Todd Marshall of Plantersville, TX. Who are you? Re. “what is provided here” are over 300 annotated articles with one principal axiomatic theme… stated and proven in less than 500 words… and presented in a pane on the right.
## Core monetary theories lack empirical foundation
The website’s central claim that “**INFLATION = DEFAULT – INTEREST = zero**” is fundamentally incorrect and contradicts basic monetary economics. This formula inverts the actual relationship between interest rates and inflation. In reality, central banks typically **raise interest rates to combat inflation**, not lower them. Paul Volcker’s successful campaign against 1980s inflation—raising rates to nearly 20% to combat 15% inflation—directly contradicts this theory.
The definition of money as an “in-process promise to complete a trade over time and space” oversimplifies money’s complex functions. Established economic theory recognizes money’s roles as a **medium of exchange, store of value, and unit of account**—concrete functions measured and tracked by central banks through money supply metrics like M1 and M2.
MD: Lack “empiracle foundation”? Really? What part of trade is not empiracly obvious? Re. “contradicts basic monetary economics”: does that make it wrong. It proves concepts of interest rates and inflation are wrong. In real trade, traders rule… not economists. BTW: I was there in the 80’s. I paid 12% interest. It was caused by the oil embargo shock. I’m going to take a couple more of these and then I’ll invite you to bring your arguments to Todd@WithGLEE.com. You obviously haven’t done your homework.
## Factual claims contain significant errors
Several specific claims made on the website are factually incorrect:
**Banking profits are grossly exaggerated**. The claim that banks earn “40% annual returns” is false by a factor of four. US banking industry Return on Equity averages **approximately 10%**, not 40%. This error suggests either misunderstanding of banking operations or deliberate misrepresentation.
MD: Re. gross exaggeration of banking profits: So banks earn 10%, not 40%? That means they’re making 1% on the spread? Really? Heck, grocerers are among the most efficient traders ever… and they make 3% without the 10x leverage advantage bankers have.
**Inflation performance claims are inaccurate**. While the Federal Reserve does target 2% inflation, the assertion that it “delivers 4% inflation on average” is wrong. Historical analysis shows inflation has averaged approximately **2.7% since 2000**, and the Fed actually struggled to reach its 2% target consistently, often running below it until recent years.
MD: Inflation in real time is a made up number. Relating it back to personal experience using the HUL as the unit of money, you can get a good long term estimate. A dollar in 1913 is worth less than 4 cents today.
**Reserve requirements are outdated**. The claim about 10x leverage through reserve requirements ignores that **the Federal Reserve eliminated all reserve requirements in March 2020**. The theoretical “money multiplier” the website describes no longer functions as presented in outdated textbooks.
MD:Re. changed in 2020. My annotations go back to 2017. So that would be before this change, right? What were they changed to? Why were they changed? I think this is enough work in debating with you in a vacuum. Contact me at Todd@WithGLEE.com
## Government debt characterization misleads readers
The characterization of tax payments as “tribute collections” to banks misrepresents debt ownership. **Banks hold only a small portion of US government debt**. The largest holders are the Federal Reserve, foreign governments, and US private investors including mutual funds and pension funds. Interest payments go to all bondholders, not just banks, and represent contractual obligations on borrowed funds.
The claim that governments “never deliver on their trading promises” contradicts the **US government’s perfect debt repayment record**. The United States has never defaulted on its obligations and maintains high credit ratings, making Treasury securities among the world’s safest investments.
## Connection to legitimate economic criticism
Despite its flaws, the website does connect to some legitimate concerns raised by **heterodox economic schools**. Austrian economists like Murray Rothbard did critique fractional reserve banking, and Post-Keynesian economists question conventional monetary policy effectiveness. Modern Monetary Theory advocates challenge traditional views of government fiscal constraints.
However, even sophisticated versions of these alternative theories differ significantly from the website’s claims. **Legitimate academic work in monetary economics is empirically grounded and peer-reviewed**, unlike the speculative theories presented here. The website appears to represent a simplified, extreme interpretation of Austrian School thinking without the nuance found in serious academic work.
## Conspiracy theory elements undermine credibility
The website’s conclusion with “Why did WTC7 fall down?” explicitly connects monetary theories to 9/11 conspiracy theories, further undermining its credibility as a serious economic analysis. This association suggests the content may be driven more by **conspiracy thinking than rigorous economic analysis**.
## Conclusion: Advocacy masquerading as analysis
MoneyDelusions.com should be treated as **ideological advocacy rather than authoritative economic analysis**. While questioning established economic systems can be valuable, this website presents demonstrably false information, misrepresents basic economic relationships, and lacks the transparency and rigor expected from credible economic analysis.
Readers seeking understanding of monetary systems should consult **peer-reviewed academic journals, established economic institutions like the Federal Reserve, and identified experts with verifiable credentials** rather than anonymous websites promoting fringe theories. The legitimate debates about monetary policy deserve serious engagement with evidence-based analysis, not the speculative claims found on this site.