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The truth is out: money is just an IOU, and the banks are rolling in it

The truth is out: money is just an IOU, and the banks are rolling in it
Back in the 1930s, Henry Ford is supposed to have remarked that it was a good thing that most Americans didn't know how banking really works, because if they did, "there'd be a revolution before tomorrow morning". Last week, something remarkable happened. The Bank of England let the cat out of the bag. In a paper called "Money Creation in the Modern Economy", co-authored by three economists from the Bank's Monetary Analysis Directorate, they stated outright that most common assumptions of how banking works are simply wrong, and that the kind of populist, heterodox positions more ordinarily associated with groups such as Occupy Wall Street are correct. In doing so, they have effectively thrown the entire theoretical basis for austerity out of the window. To get a sense of how radical the Bank's new position is, consider the conventional view, which continues to be the basis of all respectable debate on public policy. The central bank can print as much money as it wishes.

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Where machines could replace humans The technical potential for automation differs dramatically across sectors and activities. As automation technologies such as machine learning and robotics play an increasingly great role in everyday life, their potential effect on the workplace has, unsurprisingly, become a major focus of research and public concern. The discussion tends toward a Manichean guessing game: which jobs will or won’t be replaced by machines? In fact, as our research has begun to show, the story is more nuanced. While automation will eliminate very few occupations entirely in the next decade, it will affect portions of almost all jobs to a greater or lesser degree, depending on the type of work they entail. Automation, now going beyond routine manufacturing activities, has the potential, as least with regard to its technical feasibility, to transform sectors such as healthcare and finance, which involve a substantial share of knowledge work.

Jon Ronson in Conversation with Adam Curtis This article first appeared on VICE UK I've known Adam Curtis for nearly 20 years. We're friends. We see movies together, and once even went to Romania on a mini-break to attend an auction of Nicolae Ceausescu's belongings. But it would be wrong to characterize our friendship as frivolous. How Cryptocurrencies are Transforming the Oldest Profession The world is moving toward a paper-free financial system, but in the borderline-legal organizations of the world’s underbelly economy, cash still reigns as king. Any good business owner is keen to please his or her customers, particularly when it comes to prostitution. To avoid the awkward fumble of cash after a lusty romp, the frictionless convenience of digital payment systems is becoming more attractive. How long before sex workers and escort services in the US and Europe start accepting payments via services like Venmo and PayPal, and currencies such as Bitcoin, instead of cash? The business of sex While the sex industry may be the world’s oldest profession, the internet has done well to disrupt it.

How Banks Create Money The money that banks create isn’t the paper money that bears the logo of the government-owned Bank of England. It’s the electronic deposit money that flashes up on the screen when you check your balance at an ATM. Right now, this money (bank deposits) makes up over 97% of all the money in the economy. Only 3% of money is still in that old-fashioned form of cash that you can touch. Banks can create money through the accounting they use when they make loans. The numbers that you see when you check your account balance are just accounting entries in the banks’ computers. What use is a group of cultish, Corbynista clicktivists? Quite a lot, actually In Derby North earlier this month, Labour organisers were describing a welcome situation the like of which they hadn’t seen in years. That was days before the nightmare of the Manchester terror attack, which shocked the country and put the election campaign on pause. Back then, before the horror struck, Labour campaigners were enthusiastic over the response to My Nearest Marginal, an electioneering website launched by Momentum, the grassroots group of Jeremy Corbyn supporters. The site invites activists to punch in their postcodes and directs them to their nearest swing seat – constituencies such as Derby North, in the East Midlands, where the Labour candidate, Chris Williamson, lost to the Conservatives by 41 votes in 2015. It’s the country’s second most marginal seat, after Gower.

Joseph Stiglitz proposes co-op models as an alternative to trickle-down economics - Co-operative News A changing political landscape and economic challenges mean we are witnessing “interesting” but “unsettling” times, warned economist Joseph Stiglitz at the International Summit of Cooperatives in Quebec. The Nobel Prize laureate was a keynote speaker at the three-day conference, which brings together over 3,000 delegates from across the world to discuss the future of the co-operative economy. A world-renowned academic, Prof Stiglitz teaches at Columbia University and has written extensively about inequality, trade agreements and the main issues affecting the world economy. At the Summit he looked at the key challenges facing the global economy and the role of co-ops in addressing them. He said that alongside changes in the political landscape, such as Brexit and the upcoming elections in the USA, the world faced economic issues which are beyond the control of individuals and even national governments. Trickle-down economics isn’t working (Downtown Detroit, Michigan)

The Forgotten Kaleidoscope Craze in Victorian England An illustration from 1818, titled "Human Nonsense." (Photo: Public Domain/WikiCommons) It’s hard to imagine now, but in the years after the kaleidoscope was first invented in 1816, it distracted the public as much as an iPhone. A person couldn’t walk down a street in London without seeing people staring into these tubes and walking into walls from being so immersed in the new invention. Its presence was pervasive. If a person didn't own a kaleidoscope, they could pay a "penny for a peek" from London's poor or homeless, who earned a living by offering passersby a look into the patterns produced by what some termed as one of the "most important inventions and discoveries of our time." The 4 Secret Psychological Tools Filmmakers Use It may come as no surprise when I tell you that my mother used to call filmmakers the biggest fibbers and fakers out there. I guess she saw through all the shamanic tricks and sleights of hands that filmmakers use to get their stories out there. There is more. Filmmakers need to know how to get people to click on stuff on the internet. This helps them get people to watch their trailers, their webseries, their crowdfunding campaigns and hopefully buy tickets to their festival screenings.

Government debt: How much is too much? THE popularity of austerity policies has waned over the past several years thanks to evidence that it may have been counterproductive. But many are still worried by the fact that, relative to national income, government debt is now larger in many countries than at any point since WWII. Moreover, for most nations, government debt is projected to grow relative to income for years to come. Is the deficit down by two thirds? “I will be taking out to the country in this campaign a proud record of a Conservative government: … an economy with the deficit nearly two thirds down.”Theresa May, 19 April 2017 “In 2010 they promised to eradicate the deficit by 2015. In 2015 they promised to eradicate the deficit by 2020.”Jeremy Corbyn, 19 April 2017 This is correct, looking at the deficit as a proportion of GDP, and is a claim the government has made before. Public sector net borrowing went from 9.9% of UK GDP to 3.8% between 2009/10 and 2015/16. That’s a decrease of just under two thirds.

Who owns the customer in the internet of things? - Chris Skinner's blog I’ve been talking the internet of things for a while as, after all, The ValueWeb is the internet of value that underpins the internet of things. A key concept of the internet of value is how it supports your television, car, fridge, shoes, phone, computer and your partners’ and chidlrens’ things to buy and transact. How do all your things pay when they order an episode of Game of Thrones or a page from The Times? How does the system know that you’ve authorised those devices to make those transactions? Those are good questions, but the really hairy question is the end-game where everyone has smart things on the internet. Seven billion people averaging seven things each using the network creates a network of 50 billion things in the very near future. 50 billion things will be transacting 24 by 7 by 365, and they’ll be transacting in very small amounts.

Human cycles: History as science Sometimes, history really does seem to repeat itself. After the US Civil War, for example, a wave of urban violence fuelled by ethnic and class resentment swept across the country, peaking in about 1870. Internal strife spiked again in around 1920, when race riots, workers' strikes and a surge of anti-Communist feeling led many people to think that revolution was imminent. And in around 1970, unrest crested once more, with violent student demonstrations, political assassinations, riots and terrorism (see 'Cycles of violence'). To Peter Turchin, who studies population dynamics at the University of Connecticut in Storrs, the appearance of three peaks of political instability at roughly 50-year intervals is not a coincidence. For the past 15 years, Turchin has been taking the mathematical techniques that once allowed him to track predator–prey cycles in forest ecosystems, and applying them to human history.

Men in black: The Stranglers’ BBC documentary about the color black, 1982 In 1982, BBC Southwest aired a short documentary about the color black made by two members of the Stranglers. Singer/guitarist Hugh Cornwell and drummer Jet Black “were asked to put together a piece about the colour black for an arts programme called RPM,” according to Cornwell’s autobiography Around this time, the Stranglers were obsessed with the sinister Meninblack (as they stylized it) legends of UFO lore. They had released their great concept album, The Gospel According to the Meninblack , and changed their names to Hughinblack, JJinblack, Daveinblack and Jetinblack; they were even thinking about changing the band’s name to the Men in Black.