If you think that debt is fictitious then instead of paying your...

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    If you think that debt is fictitious then instead of paying your morgatge just tell that to your banker.

    I have no idea where all the money went, except that it did not went into my pocket.

    If you have money issued by government then you are a creditor and the government a debtor.

    If you have money issued by a bank be it a private or public bank then you are a creditor and the bank a debtor.

    If you have a credit note or any similar instrument issued by any entity promising to pay you on a certain date a certain amount then you are a creditor and the institution in question a debtor and if that institution defaults then you continue to be a creditor
    but this time a creditor in bankruptcy and this until the very end of the bankruptcy process.

    At the peak of the financial crises people stopped trusting one another, a situation which led to cash being hoarded instead of lent.

    As to money being created out of sin air that is a great achievement, unless the process becomes corrupted. Imagine the savings in social costs that comes from having no need for a single person to be sent to the outback digging for gold in order to use a piece of that shining metal as money.

    You can use debt in order to finance productive investment or consumption an without it no capitalist society would be able to function.

    In my opinion the main problems with debt are as follows:

    1) It leads to wealth transfer from the debtor to the creditor, who tend to be people with different marginal propensities to consume. Excessive debt constrains debtors ability to spend without that being offset by concomitant expenditure by the creditors who tend to save a much larger portion of their incomes than the debtors.

    2) It leads to higher levels of inequality as access to it depends on the amount of wealth already accumulated.

    3) It is being used as a substitute for wage increases, a process that can only function to the advantage of everybody for a limited period of time.
 
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