The only source of new money is profit i.e., adding one unit of wealth purchasable with money and one unit of money deriving its value — new incremental value — from the new unit of wealth that the money financed. If the new wealth is worth more to the market than it cost to create it, then that profit is new money. That can be proved mathematically, and that one fact, producing market wealth that is more and more valuable, in greater quantities, with borrowed money or bank-created money. That is the sole source of new money value, whether gold or bank notes or whatever. If we applied that rule to creating money, we could easily pay off the debt — convert bonds at compound interest to stock in government facotories on domestic soil. Sell the produce of the factories and pay the workers with the profits who own 51% and pay off the former owners of the bonds, now retired, with the 49% profits. Profits to replace pork-barrel and government profits to create new money. This is superior to the present system headed for meltdown because taxes and one way gov’t pork barrel spending producing nothing that can be purchased with the money spent to create it, destroys money, as opposed to profit which creates it. This is the answer to paying off the gov’t debt, creating new money, ending porkbarrel spending which destroys our money and creates inflation and if we assign the gov’t profits to the poor in exchange for their cooperative efforts in creating that profit, we can end poverty and reduce to a great extent the maldistribution of wealth. This is actually the answer and the only answer to the basic economic problems create by unbalanced capitalism.
