Other nations also have the same issue where there is ‘more debt than money’. This graph is for those Greek people with relatives in Australia.
The graph of Money Supply in Greece is remarkably similar to the left half of the graph for Money Supply for the USA during the ‘Great Depression’. The Cash Currency did not fall, but the volume of credit provided by bank loans fell dramatically. A government owned public bank would have countered this quite quickly:
The USA suffered the same indignity of a fall in bank credit. The banks stopped lending as shown in this Graph:
In the early 1930s, banks had no money to lend for peacetime purposes but very quickly had vast quantities to create bombs to drop on Germany and Japan. Money went from being unavailable to being plentiful. When the Money Supply increased, jobs were available, farm output increased, factories moved to two shifts and the depression was ended.
Great effort was made to rescue the USA from depression. The opposite is being done to Greece. Greece is being asset stripped with privatization. National assets are sold to corporations. Banks own shares in corporations. Ownership of corporations is a tangled web of ownership where they end up owning each other. The effect is that the banks own significant shares in companies that asset stripped the nation. Vultures don't eat vultures. Vultures need prey. Greece was made to squeal and the banks assisted the vultures subsequent feeding frenzy. The devil's best trick is to convince people that it is not the devil. The IMF offers help by making you submit to the vultures.
During the Great Depression, the banks stopped lending and the Money Supply fell precipitously. The velocity also fell. The cure came with a dramatic rise in the Money Supply as can be seen in the graph. It is not recognized that a rise in the velocity would have had a similar effect. Greece cannot lift the Money Supply because the banks will not maintain the credit component of the Money Supply. Under such a constraint, Greece can teach the world that extra money is not required. The situation can be repaired by lifting the velocity. To lift the velocity it is necessary to reduce Hoarded Money and spend it into circulation.
In the USA, a massive increase in debt accompanied the recovery from the depression. Nobody realized that an increase in velocity would have had the same effect:
