One way to avoid the avoid the next fiscal crisis coming in three months is to have the US Congress, particularly the House of Representatives, study and understand money/credit/debt.
Money is basically just accounting. Accounting for all the debits and credits in the world of commerce. Credit is debt. When credit, that promise to pay in the future, is extended, it is really debt.
A typical homeowner/borrower signs a promissory note, and that note becomes the "New" money in the monetary system. That is, new money in an account made by a computer transaction. In reality it's their note, therefore it's their money! However, most of these homeowners think the bank loaned them money, when in fact, as already stated, the signed, wet ink note is the new money. Then the borrower is given a loan because of their good credit. And then are coerced into signing a mortgage to secure the note giving them a debt to repay. What a miracle: At the closing table, the bank comes with no money, the borrower comes with no house and the bank leaves with a huge asset, the promissory note and mortgage, and the borrower leaves with the keys to their new home, and lots of debt. All from their credit. Amazing!
And God forbid that some will not pay back their own money. What a slight of hand! What a scam! We all have been had! Myself included. A simpler way to look at this is much like going to the library for a book. We borrow the book and bring it back two weeks later. We don't bring back two or three books. And of course, there are the few book borrowers at a library who forget to bring the book back on time and are fined.
With this new knowledge Congress could turn this crisis around by returning to their original Constitutional responsibility: the right to coin money (coin used as a verb). Just as each sovereign individual can create their own money through working for a business, being an entrepreneur or through the banks, so could the government.
There are a number of options: one, coin a couple of dozen trillion-dollar coins; two, return the Federal Reserve's responsibility to the US Treasury; and three, issue the money for all the exchanges we need, interest- and debt-free. This responsibility was deceptively delegated to the Federal Reserve in 1913 whose stated purpose is "...to provide the nation with a safer, more flexible, and more stable monetary and financial system."
From my reading in the media and worldly experiences that stated purpose is not exactly holding up. Isn't one supposed to learn from their mistakes? I understand economics could be complex but when the private ownership of the money doesn't work after 100 years isn't about time to try something else. Yes? No? IMHO the safer, more flexible, and stable monetary and financial system is one where the United States Congress recaptures its original sovereignty, issues the money, regulated of course, interest and debt for all the goods and services we, the people, need. That would end the crisis. Then again, maybe we thrive on crisis. Then again, crisis does precede transformation. What a fun time to live in!
99 Crescent Street
Newton, MA 02466