flights to romania from uk

Last week, I read "Making Money" by Terry Pratchett, which was an interesting counterpoint to the current economic situation. It didnapos;t motivate this post, but it did contribute to some of the thoughts that led to it.

One thing that I am certain of is that the banking meltdown is not the current economic crisis. It is a contributing factor, but there the problem is structural, based on a perceptual flaw. My feeling is that one of the key root causes is that people confuse money with wealth. Moving numbers around on a ledger might give you more money, but it doesnapos;t create wealth. A house appreciating might in theory give you more money, but it doesnapos;t create wealth. Itapos;s still the same house, and you donapos;t even really have more money until you sell it.

A bank taking in $100 in deposits and loaning out $1000 may create more money, but it doesnapos;t create more wealth.

My premise is that over the past sixty years the United States has been focusing more and more on getting more money, and less and less on creating wealth. An accountant may help maximize the money that you have, or keep, but itapos;s the people on the assembly line, or on the farm, or even arguably writing software, that create wealth.

As to the current financial meltdown. No wealth has disappeared, we still have the same stuff, the same raw materials, even pretty much the same oil production we had six months ago. There has just been some hiccup in the flow of this imaginary thing called money.

Another thing that Iapos;m fairly certain of, is that a major root cause is greed. But whose greed? Or is it everyones greed? Everybody wanting to get money for nothing, and nobody creating any new wealth.

Cash certainly exists, but the vast majority of money in our economy doesnapos;t. When somoene buys a house, to a first approximation, nobody showes up with a suitcase full of pictures of Benjamin Franklin. Even so, score is kept, and we can figure out where the money went.

So, where did the money come from? Where did it go?

As far as I can tell, a bank loan is kind of like a financial time machine. A bank has $100, which allows it to loan $1000, with the premise that itapos;ll be paid back in the future. I may be wrong on this, but Iapos;m pretty certain that banks are allowed to loan more money than they have.

So, the banks loaned a lot of money to people who canapos;t, or wonapos;t, pay them back, to buy houses. This money bypassed these people and went directly to the people selling their old houses. What did they do with the money? Buy more expensive houses, borrowing more money? Invest it in the stock market? Deposit it in a bank? Spend it on beer, drugs, fast cars and parties? Or did they waste it?

There are also a lot of people who borrowed money based on equity in their homes. Where did that money go?

Now, in theory, people are paying money back to the banks. Interest rates on a lot of these loans are ballooning from affordable to usurous. Can I assume that to a first approximation
all of the money, from these loans, so far, has gone to the banks, paying interest and not making any significant dent in the principal? But, since it has only been a short while since most of these loans have been made, this probably accounts for only a negligable fraction of the money that has been lost.

How much of the money went into trade deficits? Which, in turn was loaned back to us, so that we could buy more things from China. Is this why nobody has any money? We have stuff, China has a bunch of IOUs, and friction in the system has withered the flow of money down to nothing?

Oh well, thatapos;s enough confused rambling thoughts, time to get something done, if not creating wealth, at least increasing the livability of the house.
flights to romania from uk, flights to rome, flights to rome from birmingham.