Westpac Senior Economist Michael Gordon says privately owned banks should remain in charge of the nations credit supply at the point of wholesale creation, because they are more 'adult' at not abusing the process than public administrators would be. Jim Mora Radio New Zealand - ….Ok, need it be a problem? Banks have ended up in the position, as Bernard Hickey has said a time or two on the panel, where they have the franchise on the creation of money and governments put banks in this position and could very easily change the rules. A revolutionary paper by the International Monetary Fund claims that you could eliminate the net public debt, for example that of the United States, at a stroke, and by implication do the same for Britain and Germany, and Italy, and Japan. Joining us is Westpac New Zealand Senior Economist Michael Gordon. Michael good afternoon. Michael Gordon Westpac Senior Economist – Good afternoon. Jim – So I suppose at the back of this discussion is there any real reason we ask why there has to be this deep and fast flowing river of capital, ha, flowing out of our economy and into the banks, agh, across the ditch? Michael – Well... Jim – You've seen, I think, the essential argument, I think we sent you the story out of the Telegraph which attempts to analyse it, of this interesting paper, and widely discussed, discussed now, out of the International Monetary Fund about whether we could just essentially flick away all this global debt. Is it possible? Michael – Agh um, its certainly possible to have this kind of arrangement. Agh, this IMF paper, is um, really revisiting a plan, is, was really born out of the Great Depression of the 1930's, um, when there was a lot of sole searching about how did we get ourselves into this position in the first place and I think its come up again, particularly in the Northern Hemisphere where they are again asking how did we get ourselves in this position in the first place? Um, I mean Im certainly not, sort of, to well rehearsed in the exact details of the plan, but um, I guess you can, sort of, really put it on a spectrum of sort of possible plans of controlling the money supply. Um, really, but money is, is it doesn't have value in itself, but its a useful thing, so it, you know, its, its useful to have it in society. But you really need some sort of control on it so you don't have people, agh, effectively, sort of, granting themselves more of this, um, essentially valueless but useful product. Full Transcript available here; Radio New Zealand – Afternoon Panel with Jim Mora Thursday 25 October 2012 Jock Anderson and Simon Pound. http://publiccreditorbust.blogspot.co.nz/2013/03/westpac-new-zealand-senior-economist.html