Economic Ecosystem

             As an Economics student here at Notre Dame, I was particularly interested by the discussion of the creation of money and debate over a uniform global currency.  As the documentary stepped through the process by which the money supply expanded at the control of private banks, especially within the United Kingdom, and even those involved in the documentary were shocked by how easily private entities can change the money supply and affect the nation and global economies.  The banks rely on issuing debt to continue to stimulate the economy, as they can only increase the supply with loans to consumers who come to them for money to spend elsewhere.  The entire economy, essentially, rests on this system of borrowing and lending with collapse looming over the thought of a cease in this process.  
            Economist Bernard Lietaer explains the problem with national currency with an analogy of an ecosystem.  In each monetary system that has existed up the present, all of the monetary resources have risen to those at the top.  In most of these systems, however, not all of the market’s participants have understood or been explained how the economy works.  Therefore, when a single thing goes wrong, like the analogy Lietaer gives of one match in the forest, the entire system collapses and many are left wondering why.  With a lack of economic diversity, what is left standing?  Given the effects of such systems and the state in which it leaves consumers when something goes wrong, I also thought the differences in responses were interesting.  Citizens of Iceland revolted and were able to form movements to keep the power of the government and financial institutions in check, while countries like France and the US saved the institutions that left them in the same condition.  I can’t help but wonder, what does this say about these countries that are saving institutions that lost so much for many of its customers?

            -Bridget

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