Liberal Vision

Sound Money & The 10 Minute Rule Bill

If you haven’t heard of the Cobden Centre then I strongly recommend you check them out.

Named after Richard Coben, one of the most significant Liberal Party figures of the 19th Century, the Cobden Centre is a pressure group that lobbies for honest money and banking reform.

The Cobden Centre is also enthusiastically dedicated to providing education and resources for those interested in Austrian Economics subsequently their website is a treasure trove for any inquiring mind.

Founded by entrepreneur Toby Baxendale earlier this year, the centre has gone from strength to strength rapidly and is certainly a group to watch. Earlier this week Baxendale delivered some hard truths to the bankers whilst speaking in support of the Ten Minute Rule Bill: “Bankers have behaved like Welfare dependents. They exist on £ billion handouts – to fix a credit bubble they had a big role in creating. To preserve free market economics, we need to rediscover honest money.”

The Ten Minute Rule Bill would require banks to obtain consent from depositors before using funds in what critics regard as little more than a legalised pyramid scheme: the lending of the same money up to 35 times in the UK. Mr Baxendale said:

“A survey commissioned by the Cobden Centre this summer showed that a clear majority of people believe they own the money they have deposited at the bank. They do not. In fact, we are creditors to the bank’s debts, not depositors of our money for safekeeping.

“It is this sleight of hand by the banks which allows the public to be misled about the true state of our banking system. In fact, the banks are insolvent the moment we decide to withdraw ‘our’ money. This excellent Private Members Bill would force banks to ask account holders if they want their funds lent out for risky ventures or simply held on deposit.

“Since the credit crunch hit us, economists have often struggled to explain how and why it happened. Conventional wisdom is still trying to blame so-called “market failure” or insufficient regulation. Now is the time to listen to those economists who argue that the credit crunch was caused by the credit glut that preceded it. And that oversupply of credit was caused by the ability of big banks – crony capitalists – to treat other people’s money as their own”.