"Who are all these people who are worse off then 30 years ago?"
Collectively, they're called the working class, Yabby.
Where wages have increased about 400%, real estate has increased about 800%. Petrol has gone from 45c a gallon (10c litre) to well over a dollar.
Small cars from $2500, to $25,000
Where once the salaries of the CEOs were around 10 to 15 times the median wage, now they're more like 300 times.
About the only things to become more affordable, are electrical goods.
It seems gadgets have replaced religion, as the 'opiate of the masses'.
Sadly, even these goods come at a steep price for the low paid; the majority of these items are purchased with credit cards, and the stats are, more than 70% of credit cards are not paid in full at the end of the month.
And yes, obviously no one is forced to take up a credit card, or max it out. But how would our standard of living compare, if everyone actually lived within their means?
Remember, in the 60s and 70s, must households only needed one breadwinner, and he generally only worked 40-45 hours a week.

Pericles wrote, "The government allows the Banks to create a million dollars, which they lend to you. You start a successful business with it, and are able to pay it back, with interest, after a year."

The problem is that it is mathematically impossible for everyone to repay that debt. The banks create out of thin air the principle, but not the interest. As all money is ultimately debt, there can never be enough money for all who are in debt to repay their debt. One way or another someone will be unable to repay the debt and their loan will be foreclosed. Thus the contract that banks force us to sign is an impossible contract to meet if we take the viewpoint of society as a whole.

That money was created out of thin air was established in a 1969 US court ruling in favour of plaintiff Jerome Daley whose 14,000 home loan was threatened with foreclosure. As Ellen Hodgson writes:

"Daley, an attorney representing himself, argued that the bank had put up no real money for his loan.

"... (Associate Justice Bill) Drexler hadn't given much credence to the theory of the defense until Mr Morgan, the Bank's President took the stand. To everyone's surprise, Morgan admitted that the bank routinely created money it lent 'out of thin air', and that this was standard banking practice.

"'It sounds like fraud to me,' intoned Presiding Justice Martin Mahoney. ...

As a result, the bank's claim for foreclosure was rejected and Jerome Daley kept his house. This ruling has never been overruled, although, obviously, it hasn't changed prevailing bankin practice in the US or Australia.

"Justice Mahoney went as far as to to threaten to prosecute and expose the bank. He died less than six months after the Daly trial in mysterious accident that appeared to involve poisoning." ("The Web of Debt" (2008) Ellen Brown, pp28-29).

In fact, quite a few US public political figures who have stood up private banks have been murdered. (tobecontinued...)

(...continuedfromabove) Those who have been assassinated include President Lincoln (whom Otto von Bismarck stated was murdered for standing up to the bankers (Brown, p91)), President James Garfield (Brown, p94), President John F Kennedy (Brown p203). A number of attempts have been made upon the lives of others, including President Andrew Jackson.

In this light, it should be hardly surprising that President Woodrow Wilson wrote in 1913:

"Since I entered politics, I have chiefly had men's views confided to me privately. Some of the biggest men in the United States, in the field of commerce and manufacture, are afraid of somebody, are afraid of something. They know that there is a power somewhere so organized, so subtle, so watchful, so interlocked, so complete, so pervasive, that they had better not speak above their breath when they speak in condemnation of it." ( http://en.wikiquote.org/wiki/Talk:Woodrow_Wilson#.22I_am_a_most_unhappy_man....22 )

If our Government simply took back from banks what should be their sovereign right, that is to create money to facilitate the exchange of goods and services, most of our society's economic problems would vanish almost overnight.

As long as they take care to issue no more money than the level of truly productive economic activity would warrant, there should be no problem.

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Grim has responded very well to Yabby's nonsensical implication that everyone's standard of living has risen. The fact that people like Yabby are able to claim that we are all somehow better off in the face of such indisputable facts as Grim has given show what a fraudulent sham are the indicators such as GDP that economists use to measure our prosperity.

This has also been discussed at length by Yabby, amongst others, in response to my article "Living standards and our material prosperity" of 6 Sep 2007 at http://www.onlineopinion.com.au/view.asp?article=6326&page=0 http://forum.onlineopinion.com.au/thread.asp?article=6326&page=0

Yabby,

You have hit upon the fundamental problem with banks. They are not Venture Capitalist but I am saying they should invest some money in innovation as well as in bricks and mortar - but they don't. As banks are the organisations in society responsible for increasing the money supply they have a responsibility to invest some of it in innovation.

This is what the article "Money from nothing: supplying money should be a public service" is all about. Banks are given the privilege by society of creating bank money nominated as regular currency. They have made a mess of this privilege and one of the problems is not investing in innovation.

You think money for good new ideas is easy to come by. You are wrong. In Australia it is almost impossible to get investment in innovation (which is ways of doing things more efficiently and for less cost) unless you have assets to mortgage. A company in which I have a small early investment and now with 30 patents and contracts with several of the top companies in the world has had to go overseas for development funds because no bank or institution in Australia was willing to put up the money. This is a story continually repeated in my circle of entrepreneurs and innovators.

My own company is in a similar position and could expand at several times its current rate if capital was available - but it isn't.

However, watch this space because I think there is room in Australia for a bank that does not pay interest on deposits and only loans money for innovation. In doing this it would obey Islamic principles so it may have plenty of willing depositors.

*they have a responsibility to invest some of it in innovation.*

FP, you simply dreamed that up, but they have no such responsibility
at all. The stockmarket is littered with companies which have failed,
backed by Australian venture capital, some them CSIRO inventions.
It takes more then a good idea, to make money these days.

Grim, what has changed overe time is expectations. In 1970, the
average weekly wage was 71$, now its 900$. Back then people aspired
to a fibro 3by1 of 13 squares, now its a 4by2 of 25 squares.
Back then a colour tv was a luxury, now a million widescreens
a year are sold in Australia. Back then a car was basic, now they
are air conditioned, as are houses. Today middle class welfare
is huge, back then if a girl got pregnant, she would have to give it
up for adoption, there was no unmarried pension.

Back then to travel overseas or make a phone call overseas cost
an arm and a leg, now its standard, internet and mobile phones are
standard too.

Food, clothing, power tools, electricals, electronics, all cheaper
today in real terms, by a long way too for alot of goods.

Today Australians can afford to lose 18 billion $ a year gambling
and use more botox per head then any other country.

Building a house is still not expensive, but I grant you, land is
more expensive, as we have alot more people competing and Govts
restricting release of it. Blame Govts for that

Yabby,

Banks are in a privileged position in society with respect to the provision of money. They are allowed to create extra money out of thin air. In this capacity they have a responsibility to society to finance innovation. They do not finance innovation but overwhelmingly finance stuff that already exists. Did you know that last year 90% of loans for housing was for old houses while only 10 years ago it was 80% and 50 years ago it was 50%. This has happened because banks have increasingly and with alarming regularity continued to feed asset bubbles instead of constructing new productive enterprises.

They could finance innovation but they choose not to because they have turned from being investors into being cost accountants as this is better financially while assets increase in price. Cost accountants are needed to look after existing assets but we need investors to establish new enterprises and to expand old enterprises and they should get all the increase in the money supply for such investments. This is the best way to expand economies, control inflation and halt asset bubbles.

The problem is that the current system does not distinguish between money that already exists and extra money created from an expanding economy because it uses the loan mechanism to create extra money as well as lend existing money.

Banks serve a very useful purpose and are needed to look after and conserve "old money" but what we do with the money from the increase in the money supply is different and that is what Robertson's article is about and what I am talking about.