Most countries use debt based currencies, and that causes a destabilization and will lead to an inevitable crash.

More Money is Owed than Exists

source

The Perfect System

At the beginning we have the worker. The worker produces resources which are split up in three parts. The largest part is given to the capitalist, the much smaller second part is given to the worker, and an even smaller part is given to the government.

The Capitalist
To earn money without working himself the capitalist must start a business. Often most of the money the capitalist uses comes in the form of a loan from a bank. Much of the money they get goes to paying off their loans. In Europe the average small business owes £30,000 in debt.[1]

The Worker
The worker earns money and either saves it or spends it. The majority of the money the worker spends goes to the capitalists and a lot of that again goes to the banks. The worker also often takes out loans, for example, to buy a car or pay for college. The average household debt in the United States is $90,000.[2]

The government
The government takes in a lot of money through taxes. However, few governments take in more money than they spend. This means they must borrow money. They sell bonds and borrow money from the people and other countries, but that is often not enough. In the United States the government relies heavily on the Federal Reserve. The Federal Reserve buys United States bonds equal to the deficit every year, at about $0.03 for every $100 of bonds. The Federal Reserve can either sell these bonds to the people or keep them and collect interest, all tax-free

This means that to avoid defaulting on the debt the government must raise taxes. The rich and giant corporations pay little in taxes, that burden falls on you. [3]

The Banks
A lot of money is owed to banks. The banks make money off these loans. In fact loaning money makes so much money they like to borrow money just so they can loan it out. They get their money from the federal reserve. Banks have a required minimum of liquid money. This causes them to continually borrow from the federal reserve and loan out as much as possible to be able to meet the payments and make a profit. [4][5]

The Federal Reserve
The Federal Reserve creates and loans out all money with interest. This means that more money is owed to the federal reserve than exists.

Unpayable Debt

Unpayable debt means that the economy must keep moving. The banks must loan out more money to stay ahead of the debt. To loan out this money both the workers and capitalists must spend more money than they have. This does help business short term and increase growth but it runs into a problem, things must grow exponentially faster. As more money is borrowed from the federal reserve more money is owed. Eventually the amount of debt becomes too high and the banks can’t keep up. The market crashes and banks default (or are more likely bailed out by the government) to start it all going again.[6]

This market is unstable and cannot last, but the banks already have too much power. They lobby invisibly every year when the government tries to pass a bill to audit them. They already control the government, there will be no peaceful transition out of this system.

[1]source
[2]source
[3]source
[4]source
[5]source
[6]source

Want to learn more about science and economics? Subscribe and Upvote!