Banks transfer money to another bank all the time. But they really don’t, do they? They transfer numbers. That’s it.

Banks: the real crooks?

A couple of years ago, I started digging a bit on how banks work. And how money is created. The drill about this is that money is supposed to be covered by a gold reserve (national banks) or cash reserve (normal banks).

The thing is, a lot of that is simply not true. Or not true enough. Sure there are some reserves, but they are not even close to enough to cover all the ‘money’ on bank accounts. Most money is nothing more then numbers, on computers or on paper before the time of computers.

People in power kept it this way for ages. The rest of us are either too poor or little to do anything about it or have just enough to be afraid to lose it. If you want to learn more about it, I recommend watching this free movie and it’s sequels.

The James brothers!

It’s not a new phenomenon either. It exists as long as there were banks, which brings me to the quote that started this column:

We sometime didn't get enough to buy oats for our horses. Most banks had very little money in them. (Frank James)

For those who don’t know, Frank was the brother of Jesse James, and by many considered the ‘brains’ of the James outlaw gang. But it turned out even then, banks were the real crooks.

Banks and governments help each other out. That’s why we got the bailouts. Sure, Iceland was able to do it differently, and there was certainly something to be said for their method. But let’s face it: Iceland is an unusual country. They can get away with dissolving their army: who would ever want to invade it?

But banks and the rich that benefit the system control governments. They are so powerful that we could not even hope to do anything about it. Or so it was anyway.

Enter new technology and cryptocurrency.

The power of one and zero.

No classic government or power family was prepared for the silicon revolution. The growth of the computer business took everyone by surprise, resulting in powerhouses like Microsoft and apple. But even they were nothing compared to the rise of internet powers like Facebook, google, amazon and the likes.

New superrich people that did not come from old money went in with a very different mentality. One that became a new power that regularly clash with old government and money.

On top of that, the internet itself was the real game changer. Suddenly the biggest communication platform in the world was also the one that was uncontrollable. Or close to it anyway. It’s getting harder and harder for people to get away with stuff, at least in the civilized world.

In a time when taxes and big government still are getting worse, the internet started to look for alternatives. One of those is the return of basic trades: people use sites to exchange goods and services directly, without using money. No money = no taxes after all.

The second was the birth of cryptocurrency. It started with bitcoin, and soon more were developed. Of course governments were quick to declare that’s not even money. In most places it still isn’t … officially.

But there’s plenty of companies that do support bitcoin, mostly those techies that don’t really like classic governments anyway. And there’s even debit and credit cards in bitcoin now that basically allow you to use it anywhere.

Power from the people …

Thing with bitcoin is: it is not created by governments. Anyone can ‘create’ this money, but it does take a serious hardware investment. And the currency, which is based on extremely hard math, is actually a lot safer then classic electronic banking.

I guess the lesson learned is an important one: if you push people enough there will be a revolution. This time, I urge you to be ready for the currency revolution. Because it’s there and unavoidable.

Just so we’re clear btw: I’m not a communist. I am however partly socialist. I think we have more then enough recourses in the world to make sure everyone has a decent life, and am a fan of the basic income for everyone. But I also believe that those who work hard should be able to have more, even a lot more. And that people are allowed to be lucky by birth or lottery.

But the very few at the very top, that have so much they can never spend it yet hold on to it like their life depends on it while millions still suffer? That has to go. They need to look at the new rich like Zuckerberg and Gates who use the bulk of their money to better lives.

Taking away a bit of their power by using cryptocurrency gives me a bit of hope that things might in fact get better. It is of course a bit weird that I use something from the past to draw hope from something so modern. But those who don’t remember the mistakes from the past are doomed to repeat them. And that, perhaps, is one of the most important lessons one can ever learn.

Conclusion: In the end you can only push people so far …

And of course there is the design ...

 

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