Media Release

Wednesday 10 October 2012

QE or not QE?

“As the similarities with social credit are realised, the Greens proposal, erroneously labelled Quantitative Easing (QE), has given rise to many snide comments, poor jokes, and a couple of sneering articles” commented Stephnie de Ruyter, DSC leader.

“Mirth, merriment, and sarcasm aside, it is important to note the difference between QE as it has been applied in the Northern Hemisphere and social credit as the DSC would apply it in New Zealand.

“The programme of QE in the UK, USA, & Europe is delivered by privately owned central banks. Governments authorise their central banks to issue computer generated debt with which to purchase computer generated bonds. The computer 'money' becomes parked in the reserve accounts of banks, enabling the banks to lend more interest-bearing debt. Its predictable outcome has been to prop up the same private banks complicit in the debt crisis that QE is supposedly alleviating. In short, QE is the mechanism used to support the banking sector. It does nothing more than maintain lending and encourage higher levels of indebtedness. No growth, no jobs, no investment, no future, just debt. It’s a foolish course of action taken by desperate men but the banks are enjoying massive profits.

“New Zealand’s central bank, the Reserve Bank, is publicly owned. Provision exists for our government to establish a Reserve Bank credit facility (call it an interest free virtual overdraft) to provide the financial resources required for major projects such as the Christchurch rebuild. That’s not QE, it’s social credit. After all, why be in debt to overseas lenders when the same computer generated money’s available here?

“Direct government spending on infrastructure such as housing, roads, schools, and hospitals creates jobs, encourages investment, and builds a future, without massive intergenerational debt.

“New Zealand has travelled a some distance down the social credit path before – think state housing, the Rural Bank, State Advances Corp, NZ Dairy Board, and so on.

“The DSC contends that it’s time to do so again, because social credit works” concluded Ms de Ruyter.

ENDS

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