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An impulse speech by Prof. Richard Werner opened yesterday's Socratic Debate at the Hayek Institute in Vienna 🇦🇹.

The “interest rates drive growth” theory is empirically wrong, he showed; rates follow growth, an 'Austrians' agree. Bank credit creation and its allocation decide whether economies boom or bust.

Prof. Werner warned that central banks, regulator-driven centralisation, and CBDCs will wipe out Europe’s local SME-lending banks (thousands already gone). The real path to prosperity is many small regional banks directing credit into productive investment, not speculation.

Our main point for debate was that Prof. Werner thinks that this can be fixed with the right policy prescription for central banks, whereas I think that the very institution of central banks and their enormous illegitime power will invariably lead to negative economic and political outcomes in time. Central banking and CBDCs are incompatible with free markets and a free society.

#Bitcoin shows that money (SoV) creation is a matter for the free market, and #Bitcredit aims to show the same for currency (MoE) creation.

Read on.

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Hu₿ertus the Austrian 0mo ago 💬 1

Continued:

Our subsequent Socratic Debate went on for many hours into the night, as always. Topics covered were:

- How long can a fiat system work and survive?

- How can we make sure that credit goes towards the productive businesses only?

- How can we increase productive credit? What incentives are organically available?

- Is there a precedent of a country that migrated from asset-based speculative credit and money creation to production based money creation?

- How does the Austrian school consider the inflation impact of the three types of loans mentioned by Professor Werner, for (1) production, (2) consumption, (3) asset speculation?

- How do we solve the energy situation (price & quantity) in Europe if Russian relations and supply chains like Northstream are broken for at least a generation?

- Concerning Euro: will fiscal imbalances and asset bubbles precipitate a collapse of the Euro?

Read on.

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Discussion

Hu₿ertus the Austrian 0mo ago

Continued:

- Should we return to national currencies?

- How should we interpret the massive gold purchases made recently by central banks?

- Which countries are moving towards a more decentralised monetary system?

- How will our life look like long-term if each payment with CBDC money needs some kind of application with the central bank?

- Do EU citizens have any chance of averting the centralisation of money and power with CBDC?

- Can we abolish the ECB?

- How to stop CBDCs, at least in the EU?

- Is it possible to create an independent, decentralised monetary system without the approval of lawmakers?

- Is it really just the banks underserving industry or is there a generational decline in German industry which reduces bank business?

- Wirtschaftsweise Werner von Sinn (Germany) says we have now after COVID much more new Money and Credit than what triggered the Financial Crisis of 2008/2009. Will this again result in a Big Crash and when?

- How much regulation is necessary to prevent misbehaviour of market participants?

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