Just finished reading Debt,
Just finished reading Debt, The First 5000 Years by David Graeber which Stuart said we should all read. An interesting read. Although he seems to share the delusion that, with so-called “fractional reserve banking”, banks can create credit and money out of nothing, he does expose one of the quotes used to back this up as a fabrication.Banking and currency cranks are always quoting “Sir Josiah Stamp”, a director of the Bank of England in the 1930s, as saying:
Quote:
The modern banking system manufactures money out of nothing. The process is perhaps the most astounding piece of sleight of hand that was ever invented. Banking was conceived in iniquity and born in sin. Bankers own the earth; take it away from them, but leave them with the power to create credit, and with the stroke of a pen they will create enough money to buy it back again … If you wish to remain slaves of Bankers, and pay the cost of your own slavery, let them continue to create deposits.
Graeber comments (p. 344):
Quote:
It seems extremely unlikely that Lord Stamp ever really said this, but the passage has been cited endlessly—in fact, it’s probably the single most often-quoted passage by critics of the modern banking system.
In a footnote (pp. 448-9) he goes into more detail:
Quote:
Said to have been given at a talk at the University of Texas in 1927, but in fact, while the passage is endlessly cited in recent books and especially on the internet, it cannot be attested to before roughly 1975. The first two lines appear to actually derive from a British investment advisor named L.L.B. Angas in 1937: “The modern Banking system manufactures money out of nothing. The process is perhaps the most astounding piece of sleight of hand that was ever invented. Banks can in fact inflate, mint and unmint the modern ledger-entry currency” (Angas, Slump Ahead in Bonds, New York, 1937: 20-21) . The other parts of the quote are probably later inventions—and Lord Stamp never suggested anything like this in his published writings. A similar line, “the bank hath benefit of all interest which it creates out of nothing” attributed to William Patterson, the first director of the Bank of England, is likewise first attested to only in the 1930s, and is also almost certainly apocryphal.
In other words, some banking/currency crank made up these quotes and others just reproduce them as genuine. This probably applies to many of their other quotes too.