Possibility Productions

Justin Fanti

By Hernando de Soto

In the second half of the nineteenth century, a series of brutal recessions endured the largest economies in the world. At this time, most forms of reliable business knowledge in the feudal, documents, and tribal groups were organized relations. If you know, if you wanted to land or a debt owned, it was locally recorded – and shielded from outsiders, probably a fact. At the same time, the world has been extended. Travel common and global trade increased between cities and countries. The result was a large gap between the old, fragmented social order and the needs of a growing, global market economy.

To prevent the breakdown of the industrial and commercial progress, hundreds of creative reformers showed that the world is a common set of facts necessary. Knowledge collected, organized, standardized, recorded, constantly updated and had to be easily accessible so that all players in the world of the extension could markets, in the words of France free banking champion Charles Coquelin, “pick up thousands of filaments, the companies create.”

The result was to capture the invention of the first massive “public memories” and classify – in rule-bound, certified and publicly available registers, title, balance sheets and statements of account – all relevant knowledge available, whether intangible (shares, commercial paper, TatenLedger, contracts, patents, company and promissory notes), or fixed assets (land, buildings, boats, machines, etc.). To know who owned and owed and fix this information in public records, made it possible for investors to derive value, take risks, and track results. The final product was a revolutionary form of knowledge: “economic facts.”

In the last 20 years, quietly gone about these facts to destroy Americans and Europeans. The very systems that are to prevent markets and Governments with the resources, which could – have given understanding global financial crisis, and another – is undermined. Governments have allowed to develop markets shadow and can reach a size beyond comprehension. Mortgages were granted and with such inattention, that House and apartment owners and banks often do not know and cannot prove, who recorded their homes. In a few decades in the West, legal reforms, beaten 150 years that the global economy made possible.

The results are hardly surprising. In the United States, trust between banks and subprime mortgages has split owner; between foreclosing agent and courts; between banks and their investors – even between banks and other banks. Total credit continue to constantly flow (from the Latin “trust”), but closer examination shows that non-governmental credit awarded has. Since 2007, the sector of private lending has dropped 21 percent. Outstanding loans for small businesses more than 6 percent declined in the last year, while lending to large companies, plummeted by more than $1 million, nearly 9 percent measured in commercial loans.

The importance of the economic facts may not be obvious Americans. “What water white fish in which it swims?” asked Albert Einstein. But it’s easy to capture from the perspective of the developing and former Communist countries, where I life and work. In these countries, most of our assets and relationships in the informal sector are the legal economy, outside. Because they are recorded in public memory systems can not they as facts and are in fact invisible be written to. All we are shadow markets.

Without standardization, the values of assets and relationships are so variable that they can be used generate loans, mortgages and bundle them into securities, to ensure representation of shares to raise capital. Still the standard slots they fit necessary to open up global markets. That is, why are chronic credit crunches and massive unemployment conditions for most people are forced to work in the informal economy. These are, you see protesting in the streets of Arab countries or living in tents surrounding Port-au-Prince. We know only too well that facts not to speak: they must be built through legal processes and transparent held. You must be defended, to.

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