Godfrey Bloom Talks Crypto Merits And Likens Quantitative Easing To Printing Fake Money
Godfrey Bloom Likens Quantitative Easing To Printing Fake Money
Five years ago, Godfrey William Bloom, sparked an intense debate at the European Parliament when he claimed that banking institutions are broke. He also criticized the practice of fractional reserve banking.
According to Bloom, central banks are to blame for the inadequacies of the fiat money systems. This is because these institutions have the power to mint and circulate money at their own volition. Additionally, Godfrey stated that banks are insolvent because they can lend money without actually owning the money. This is called fractional reserve banking.
Back then, the value of Bitcoin was below $100. Despite the shortcomings of the fiat system, people had no alternative because of the low adoption rates for Bitcoin and digital currencies as a whole.
Furthermore, Bloom mentioned that the power to print and circulate new money, called quantitative easing, means that central banks have control over the global economy. In this regard, Godfrey said that quantitative easing and fractional reserve banking are adversely affecting the economies of various counties. In addition, he likened quantitative easing to printing counterfeit money, a crime that attracts a lengthy jail sentence. Ironically, the same governments that jail people for printing fake money are the on the forefront of quantitative easing.
Recently, the US government blocked Iran from accessing the SWIFT international money transfer service. This is an ideal example of the adverse effects of having a financial system controlled by central banks. Concerning this Steve Keen, a professor of economics at Kingston University, said that the system should be devised in such a way that governments such as the US cannot control who accesses a service such as SWIFT.
Cryptocurrencies – A Viable Alternative?
The increasing popularity of digital currencies has provided an alternative financial system to fiat money. In fact, Iran is considering using cryptocurrencies as the replacement for SWIFT in facilitating international money transfers. Also, others countries like Venezuela have launched digital currencies to solve the inefficiencies of their existent fiat money systems.
As of now, plans are underway to create a financial system that cannot be controlled by powerful countries such as the US. Cryptocurrencies could be up for consideration in this regard.