Are bank loans fraudulent?
Hardly. Some people claim that “When a bank grants a $100,000 loan, all the bankers are doing is taking $100,000 of actual cash value from the borrower and transferring that value to the bankers for free.” This is incorrect for several reasons. First, banks take a person’s promise to repay, that is a person’s “debt,” and monetizes that debt (creates currency) for the person by way of the bank’s special government license to do just that. That is why the system is called a “debt-money system.” Those words mean exactly what they say. That is, currency gets created through debt. Currency gets loaned into existence. Second, the transfer is not free. The borrower willingly signs the note (a debt instrument), and expects to receive currency in return. This is exactly what happens. However, the currency is created by the bank at the moment the note is signed. The bank then loans the currency. Third, the note does not create the currency, the bank creates the currency. Yes, the note “funds the
