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E-book Money and Debt: The Public Role of Banks
Money, as the saying goes, makes the world go round. Everybody uses it; ourmodern societies would not function without it. Credit is just as crucial, as borrowingallows businesses to invest and consumers to buy goods and services today againsttheir income tomorrow. But although money and debt are central in our societies andto our welfare, how they actually function is not easily understood.Thefinancial crisis of 2007–2009 and its social, economic and political conse-quences have led to debates in many countries about fundamental reform of thefinancial-monetary system. Citizens’initiatives–such as Positive Money in theUnited Kingdom–have pushed for a debate on a fundamentally different monetarysystem, called the sovereign money system. Along the same lines, Martin Wolf, oneof the best-known columnists at the Financial Times, has called for an alternativemonetary system. Economists at the International Monetary Fund (IMF) and theBank of England (the UK central bank) are conducting research in this area. TheIcelandic parliament has drawn up a proposal on this subject and in Switzerland areferendum was held in June 2018 on the similar Vollgeld initiative, in which 24% ofvoters supported it and 76% were opposed.
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