It is a way of increasing monetary power without investing in the productive growth of industry. Certainly if you look at Britain and America as outstanding examples of this, these are countries with very high rates of private home ownership so you've got a good base to try and perform this sort of policy off the back of.
Economists don't understand this stuff. Money doesn't come out of economic activity. A lot of people I've come across kind of assume that if you have got businesses, and you've got people doing things, that somehow money emerges out of the process of people doing things, making things and growing things, selling things and producing things, that somehow money just emerges. It's not. It's like oiling a car. You have to put it in.
When I see David Cameron talking about how we need an economy not based on debt, what we need is an economy based on savings, he just doesn't know what he's saying. It's ridiculous.
The efficient markets hypothesis, the idea that you have set up a financial market, they're fast, everybody in them is well informed, they all keep a very careful eye on what everyone else is doing, it'll therefore be very stable and reflect real changes in the economy.
Another option is a basket of currencies, so you mix up the value of different currencies to create a very solid currency that people have confidence in. Perhaps even better would be a basket of commodities with which to back up international currencies. Now if it was possible, internationally, some way or another, to get all these increasingly competing national economies together, and say, "We're all going to sit down and write out an agreement, somewhat like the Bretton Woods agreement, which will allow for, unlike Bretton Woods, some currencies to be pegged against different baskets of goods more appropriate to their national economies. If you could arrange for that to happen then that would be nice, and that would start to create a kind of order in the international macro-economy which is otherwise lacking.
Policies such as student fee increases and the privatisation of public services, assets and industry follow the same model. The problem we're facing is that there is this transference from the public debt to private debt.
Thus, the bank "trades" money, and there is no other meaning in its activities. The bank "sells" money to you in installments and wants (is obliged) to receive money for its "goods". Any loan is secured by the borrower's money in the form of his income. The essence of the loan is not to receive money that you do not have, but to receive money that you do not have now, but they are in the future. Moreover, this future in the eyes of the bank should be rosy, fully predicted and documented, no one will believe in the projects.
The reason for the negative decision in your case is banal: you don't have your own money in the future. Your presented assets in the form of real estate and other wealth are illiquid for the bank. Cash flow is the only argument in favor of making a positive decision on granting a loan. The rest of your assets will only affect, and then indirectly, the loyalty of the bank.
Measuring inflation is not a science and the way it is recorded poses a dilemma. The Consumer Price Index, or CPI, is measured from a sample of goods and services. Each category of goods and services is given a weighing data which determines the overall impact of the price data for a specific category.