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Printed from https://www.writing.com/main/view_item/item_id/1607313-FUNCTIONALITY-AND-IMPACT-OF-CREDIT-CARDS
Rated: E · Article · Finance · #1607313
Are Credit Cards really Counterfeiting and Money Laundering?
Ever noticed that a credit card agreement never explains how you acquire a no loan debt, but just obligates you to pay? The counterfeiting and money laundering that really happens should be at least explained, if not out right illegal.



When a credit card is signed for, the signature is monetized; that is turned into money. No actual loan is made. (Under FDIC regulations it is illegal to loan owned assets.) The agreement to pay creates an asset to the issuer of the card. The money is literally created out of thin air by a simple entry on their accounting ledgers. Technically this is electronic counterfeiting without the printing press.





Now when we make a purchase with the credit card, we of course get a bill or invoice to pay back what was spent. The payment we make is with real, hard earned, dollars. This is technically money laundering because we have turned counterfeited dollars into real dollars for the issuer of the credit card. The interest and fees, on top of the counterfeited dollars, are true usury.



I hope it is evident how horrible this is for the economy. This process of creating money without an increase in services has produced monetary inflation. This in turn creates the inflation in prices that we always hear about as "inflation", but is a by product of the expanded money supply without an equivalent expansion in services in the economy as a whole.



This also explains how our economic depression was created. The money supply was contracted or shrunk when credit limits were lowered. Services remained constant, but there is less money to go around to them. The same money contraction was used to create the depression of the 1930's.



Notice no debt ever really exits with a credit card. First, their never was a loan to create a debt. Second, all retailers are paid, consequently, no debt really exists.

© Copyright 2009 Alma Coyle (ddavee at Writing.Com). All rights reserved.
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