Flaws of an Interest-Based Economy

Interest by definition is a method for the wealthy, to increase their wealth, and for the poorer to make a loss, normally from a desperate situation or a need. Now that it’s widely implemented across the world, this effect has been magnified globally.

What you’ll find in today’s economy is that progressively fewer people can live a life of comfort, whilst the majority are indebted and struggling, or too poor to eat a decent meal. As for those in debt, many of these debts are never to be paid, due to the interest that keeps on amplifying upon them; hence the global economy has collapsed very terribly due to some large holes. Interest is one of the completely failed methods of today’s economy and must be irradiated for any true hope of a recovery.

Paper money, with no intrinsic value is another major flaw and is closely related. This is something that also needs to be removed, and will be discussed in another post.

Interest = Profit? – False!

“If you can make profit on products, why not make it on money?”

“If you can make money in a profitable business after taking a bank loan, why not pay some of the profit to the lender (interest)?”

Answer: Not all debt is for business investment; it can be for individual needs. And by the way, there is no business in the whole world where there is fixed and guaranteed profit without any risk, so why should the lender make a fixed profit for doing nothing, while the debtor works hard at his business and still risks a loss?

So what are the Differences Between Dirty Interest and Clean Profit?

If you purchase or manufacture a product and sell it to a customer at a higher price, then you make a profit after taking a risk. Note: The product now belongs to the customer; he/she doesn’t have to return it to you. As for the moneylender that charges interest, there is no risk, and the debtor still has to return the product (sum) after paying the profit (interest).

If you make a profit, you make it once, where as with interest, you rinse the person out until he/she has paid everything, including the interest, and this can go on forever! (Remember, this is happening on a global level, between countries, and the IMF, causing entire nations to collapse with starving citizens, and now the problem is becoming apparent in the UK).

Profit is “earned” through some method of work, whereas interest is “snatched”, after doing absolutely nothing for it. (Note: there is no risk involved for the banks point of view, because the taxpayer is used if the money is not paid back to the banks, hence causing an even deeper hole in the economy).

Naturally interest hinders the progress of a successful economy, encouraging absolute selfish exploitation, which in turn causes further problems when people respond to total unfairness, e.g. crime. The only known economical solution that comprehensively works without interest is the Islamic Economical System. And by the way, it doesn’t even involve an income tax, yet it has worked for centuries until it was demolished in order to favour corruption at the western elite level.