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New Economic Ideology

That isn't a free market. A free market is one that keeps coercion to an bare minimum. Something that would have to be quite common for credit to disappear.

That's what I've been saying. Good luck to you where I have failed.
 
That's what I've been saying. Good luck to you where I have failed.

Yeah, I mean does he expect me to pay for a house in cash or something?
 
That isn't a free market. A free market is one that keeps coercion to an bare minimum. Something that would have to be quite common for credit to disappear.

Ok then. It is a coercive system. So you are left with two choices: one free system that does not work and one coercive system that does work. What do you do, Sir?
 
Ok then. It is a coercive system. So you are left with two choices: one free system that does not work and one coercive system that does work. What do you do, Sir?

Doesn't work? I'd rather not pay for a house or car in cash.
 
Besides credit, what alternative would I have?
 
Besides credit, what alternative would I have?

First credit increases the cost of long-term assets. Second it is probable that you will be making more money. Third there is no reason to consider the ownership of a house the purpose of your life (I believe this economy will change your relation to ownership):

There are changes in other spheres too which we must expect to come. When the accumulation of wealth is no longer of high social importance, there will be great changes in the code of morals. We shall be able to rid ourselves of many of the pseudo-moral principles which have hag-ridden us for two hundred years, by which we have exalted some of the most distasteful of human qualities into the position of the highest virtues. We shall be able to afford to dare to assess the money-motive at its true value. The love of money as a possession -as distinguished from the love of money as a means to the enjoyments and realities of life -will be recognised for what it is, a somewhat disgusting morbidity, one of those semicriminal, semi-pathological propensities which one hands over with a shudder to the specialists in mental disease. All kinds of social customs and economic practices, affecting the distribution of wealth and of economic rewards and penalties, which we now maintain at all costs, however distasteful and unjust they may be in themselves, because they are tremendously useful in promoting the accumulation of capital, we shall then be free, at last, to discard.

Of course there will still be many people with intense, unsatisfied purposiveness who will blindly pursue wealth-unless they can find some plausible substitute. But the rest of us will no longer be under any obligation to applaud and encourage them. For we shall inquire more curiously than is safe to-day into the true character of this “purposiveness” with which in varying degrees Nature has endowed almost all of us. For purposiveness means that we are more concerned with the remote future results of our actions than with their own quality or their immediate effects on our own environment. The “purposive” man is always trying to secure a spurious and delusive immortality for his acts by pushing his interest in them forward into time. He does not love his cat, but his cat’s kittens; nor, in truth, the kittens, but only the kittens’ kittens, and so on forward forever to the end of cat-dom. For him jam is not jam unless it is a case of jam to-morrow and never jam to-day. Thus by pushing his jam always forward into the future, he strives to secure for his act of boiling it an immortality. Perhaps it is not an accident that the race which did most to bring the promise of immortality into the heart and essence of our religions has also done most for the principle of compound interest and particularly loves this most purposive of human institutions.

I see us free, therefore, to return to some of the most sure and certain principles of religion and traditional virtue-that avarice is a vice, that the exaction of usury is a misdemeanour, and the love of money is detestable, that those walk most truly in the paths of virtue and sane wisdom who take least thought for the morrow. We shall once more value ends above means and prefer the good to the useful. We shall honour those who can teach us how to pluck the hour and the day virtuously and well, the delightful people who are capable of taking direct enjoyment in things, the lilies of the field who toil not, neither do they spin.

But beware! The time for all this is not yet. For at least another hundred years we must pretend to ourselves and to every one that fair is foul and foul is fair; for foul is useful and fair is not. Avarice and usury and precaution must be our gods for a little longer still. For only they can lead us out of the tunnel of economic necessity into daylight.

I look forward, therefore, in days not so very remote, to the greatest change which has ever occurred in the material environment of life for human beings in the aggregate. But, of course, it will all happen gradually, not as a catastrophe. Indeed, it has already begun. The course of affairs will simply be that there will be ever larger and larger classes and groups of people from whom problems of economic necessity have been practically removed. The critical difference will be realised when this condition has become so general that the nature of one’s duty to one’s neighbour is changed. For it will remain reasonable to be economically purposive for others after it has ceased to be reasonable for oneself.

The pace at which we can reach our destination of economic bliss will be governed by four things-our power to control population, our determination to avoid wars and civil dissensions, our willingness to entrust to science the direction of those matters which are properly the concern of science, and the rate of accumulation as fixed by the margin between our production and our consumption; of which the last will easily look after itself, given the first three.

Meanwhile there will be no harm in making mild preparations for our destiny, in encouraging, and experimenting in, the arts of life as well as the activities of purpose.

But, chiefly, do not let us overestimate the importance of the economic problem, or sacrifice to its supposed necessities other matters of greater and more permanent significance. It should be a matter for specialists-like dentistry. If economists could manage to get themselves thought of as humble, competent people, on a level with dentists, that would be splendid!
 
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I will not be making nearly enough money to buy a new house by myself, and how does no credit make me live for today? If anything, I'd have to save a lot more now.
 
I will not be making nearly enough money to buy a new house by myself, and how does no credit make me live for today? If anything, I'd have to save a lot more now.

If you have now enough money to buy anew house by yourself I guess you will pass this opportunity and wait till you need it. If you don't feel the system is not working for you why even talk about the subject.

If you need credit to live day to day then you have a problem, which contradict the previous statement. It isd now necessary to become coherent.

If you have more money and you will in our system all of your objections have a solution.

Again I am not trying to convince those who believe the system work, I am providing a solution for those who believe the system does not work. Why repair something that do work.

My working hypothesis is that soon 20% of the population will need that. Beyond that the system will be closed.
 
Care to expand on this point?

By increasing the rice you can pay for a long-term asset you can buy at a higher price hence bidding up those long-term assets.

For example if there was no credit there wouldn't have been a home market bubble.
 
By increasing the price you can pay for a long-term asset you can buy at a higher price hence bidding up those long-term assets.

This is still incredibly vague.

For example if there was no credit there wouldn't have been a home market bubble.

Nor would there have been all those jobs building homes, shipping supplies, making tools, etc.... In order for your analysis to be valid, you must hold everything else constant. Not a very realistic "model".
 
No credit? You'd have to outlaw savings too otherwise people will use that to loan money.
 
If you have now enough money to buy anew house by yourself I guess you will pass this opportunity and wait till you need it. If you don't feel the system is not working for you why even talk about the subject.

If you need credit to live day to day then you have a problem, which contradict the previous statement. It isd now necessary to become coherent.

If you have more money and you will in our system all of your objections have a solution.

Again I am not trying to convince those who believe the system work, I am providing a solution for those who believe the system does not work. Why repair something that do work.

My working hypothesis is that soon 20% of the population will need that. Beyond that the system will be closed.

OK, I cannot understand this. Improve your grammar.
 
This is still incredibly vague.



Nor would there have been all those jobs building homes, shipping supplies, making tools, etc.... In order for your analysis to be valid, you must hold everything else constant. Not a very realistic "model".

You don't need credit to have demand... Your analysis suppose that any economy will have the same clearing price that is a fundamental flaw.
 
No credit? You'd have to outlaw savings too otherwise people will use that to loan money.

Yes we will outlaw credit with interest rate. Anyone entering a credit contract with interest rate would be disconnected of our economy either lender or borrower. But more importantly we will not enforce credit contracts which should dissuade anyone to lend.
 
If you have now enough money to buy a new house by yourself I guess you will pass this opportunity and wait till you need it. If you don't feel the system is not working for you why even talk about the subject.

What don't you understand in this sentence?
 
After reading it aloud, it makes mores sense, but it is poorly written.

I never said that I need credit day to day, but I do need credit for the occasional large purchase; how will ending credit make housing more affordable for me anyway? How will my salary increase so much that I can afford a house out of my pocket?
 
After reading it aloud, it makes mores sense, but it is poorly written.

I never said that I need credit day to day, but I do need credit for the occasional large purchase; how will ending credit make housing more affordable for me anyway? How will my salary increase so much that I can afford a house out of my pocket?

First because credit will be illegal the rent will be not constituted from a reward for capital plus some depreciation but only the depreciation.

You will make more money I am certain.

Who said you need to own your home... That illusion has not cost enough lives already?

You will never learn?
 
Without lending how are you even going to build a home, let alone own it?
 
Without lending how are you even going to build a home, let alone own it?

If you don't have the cash you won't. If you are in a position of buying a home (being able to get the credit and the down paiement) your situation is not yet difficult enough to look for a solution.

Why are you looking for a solution to a problem you don't have?
 
If you don't have the cash you won't. If you are in a position of buying a home (being able to get the credit and the down paiement) your situation is not yet difficult enough to look for a solution.

Why are you looking for a solution to a problem you don't have?

Who in the world will have the money to build apartment complexes? What will a couple just out of school and wanting kids have to do? Wait until they are 60 until they have enough money to buy a house? What if they want kids? Are we just going to show them the door and say that they have to rent? I mean I hate to break it to you, but renting is much more expensive than owning. If I intend to stay in the place for a long time, I'm better off trying to buy it, but I would need credit to do that.
 
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