Usury?

[Texas_Roofer]

Hmm, what about a savings account? I receive (dismal) interest on my savings account, because the bank lends out the money. But I am at no risk, since the bank and the government both guarantee the account. I suppose the back could go under and anarchy reign in the nation, but I’m not sure I’d count that as a real risk.

It is because there is no real risk that the reward is so poor, however if you look at the taxes ( and real dollars) the return is negative! Move the money

I think the banks these days lend mostly non-existent money (money they create out of nothing). Anarchy is a possibility in the world today including the USA, but when and if that happens, our paper money will probably not be worth anything anyway.

“Dismal” interest is not usury. It isn’t even “reasonable.” We could all start putting our money between the box springs and the mattresses or even dig a hole in the back yard, if we have one, and bury the money there in a water-proof vermin-proof box if we are concerned about banks being usurious. I’m too lazy to do this.

If the system fails the money in the box is worthless!

This country was built upon Protestant capitalistic “ideals” concerning money and finance.

As each pays his own way

… - if one thinks those ideals are not good ones, how in the world do you escape from them?

? to escape from “Protestant capitalistic “ideals” concerning money” you simply do not jail offenders- that is where we are today. Company after company “lost” billions they replaced stocks, bonds, loans, etc… with worthless pieces of paper (as credit swabs, and derivatives) so were they jailed or rewarded? How about the originators of these papers are they in jail or retired for life at an early age?

 

[1holycatholic]

It’s listed in the Catechism.
vatican.va/archive/ccc_css/archive/catechism/index/u.htm

 

[SHW]

If the system fails the money in the box is worthless!

True. Unless it is all gold and/or silver coins/bullion.

? to escape from “Protestant capitalistic “ideals” concerning money” you simply do not jail offenders- that is where we are today. Company after company “lost” billions they replaced stocks, bonds, loans, etc… with worthless pieces of paper (as credit swabs, and derivatives) so were they jailed or rewarded? How about the originators of these papers are they in jail or retired for life at an early age?

They should be in jail doing hard labor and all their assets should be confiscated and sold in order to repay the people they swindled.

The present system is based on greed. The “workers” receive a disproportionate amount of the “wealth generated” in payment for their work while a few “owners” get immensely rich. This is not just.

 

[bacon_man]

True. Unless it is all gold and/or silver coins/bullion.

They should be in jail doing hard labor and all their assets should be confiscated and sold in order to repay the people they swindled.

The present system is based on greed. The “workers” receive a disproportionate amount of the “wealth generated” in payment for their work while a few “owners” get immensely rich. This is not just.

Then what would the ideal system be?

 

[SHW]

Then what would the ideal system be?

Some have suggested reviving the guilds of old as a start.

http://www.historylearningsite.co.uk/medieval_guilds.htm

If the Chastisement consisting of a World War and the Three Days of Darkness happen as prophesied, then we will be forced back into a more primitive way of life compared to what we have now, because of the world-wide destruction of property and of infrastructures such as power plants, petroleum refineries, internet and other communications systems, etc.; and also the loss of 3/4 of humanity who die as a result from this Chastisement.

There will be no big box stores after the Chastisement. Instead, village or small town rural life will become the norm out of necessity.

Our country should print and control its own money, not the unFederal Reserve which is but a tool of worldwide bankers whose purpose and goal is to force total domination over the world’s citizenry.

 

[ML561]

So is it wrong to have a savings account, or a certificate of deposit? Interest builds up on those monies (although very little these days–the most is 4 or 5%).

I think the interest rates the credit card companies are charging now is outrageous and could be construed as usury, if not outright theft. Notice how the credit card companies prey on people such as students just leaving college who may or may not have secured employment. If people are not careful and succumb to the credit card companies’ offers, they might be saddled with a lifetime of debt, only able to pay off the interest, if that. I refuse to have a credit card, although I do have a savings account. Peace.

 

[SHW]

So is it wrong to have a savings account, or a certificate of deposit? Interest builds up on those monies (although very little these days–the most is 4 or 5%).

I think the interest rates the credit card companies are charging now is outrageous and could be construed as usury, if not outright theft. Notice how the credit card companies prey on people such as students just leaving college who may or may not have secured employment. If people are not careful and succumb to the credit card companies’ offers, they might be saddled with a lifetime of debt, only able to pay off the interest, if that. I refuse to have a credit card, although I do have a savings account. Peace.

It is not wrong to have a savings account that earns interest.

I agree that many credit card companies charge usurious interest.

 

[tqualey]

Hi, Shw,

I think this is correct…

Luke 19:23
Why then did you not put my money in the bank, that at my coming I might have collected it with interest?’

Reasonable interest is not usury according to Jesus.

You may find this link of interst: newadvent.org/cathen/15235c.htm But, few things are either simple or easy … here is a quote from this link which will show you how the position has not remained fixed for very long:

“The precise question then is this: if we consider justice only, without reference to extrinsic circumstances, can the loan of money, or any chattel which is not destroyed by use, entitle the lender to a gain or profit which is called interest? To this question some persons, namely the economists of the classic school, and some Catholic writers, answer “yes, and always”; others, namely Socialists and some Catholic writers, answer, “no, never”; and lastly some Catholics give a less unconditional answer, “sometimes, but not always”; and they explain the different attitudes of he Church in condemning at one time, and at another authorizing, the practice of taking interest on loans, by the difference of circumstances and the state of society.”

I think what we have recently seen from the credit card companies has been not only greed but panic in the way they have unreasonably increased interest rates and then hiked up various fees. So badly have these moneyed companies acted, that Congress recently pass a law this past May. Here is a link: mondaq.com/article.asp?articleid=81090

Hope this helps.

God bless

 

[tqualey]

Hi, 1holycatholic

I went to the link…

It’s listed in the Catechism.
vatican.va/archive/ccc_css/archive/catechism/index/u.htm

but, honestly, did not find “…lending money at interest, 2269, 2449…” very helpful to understand this topic.

God bless

 

[WillieWonka]

The pope makes the definition of usury very clear. This appears to be a papal teaching on morals given wide distribution and intended as a teaching and binding on all Catholics.

"I. The nature of the sin called usury has its proper place and origin in a loan contract. This financial contract between consenting parties demands, by its very nature, that one return to another only as much as he has received. The sin rests on the fact that sometimes the creditor desires more than he has given. Therefore he contends some gain is owed him beyond that which he loaned, but any gain which exceeds the amount he gave is illicit and usurious."

ON USURY AND OTHER DISHONEST PROFIT
Encyclical of Pope Benedict XIV promulgated on November 1, 1745.
papalencyclicals.net/Ben14/b14vixpe.htm

 

[tqualey]

Hi, SHW,

I agree with you on this…

It is not wrong to have a savings account that earns interest.

I agree that many credit card companies charge usurious interest.

But, do you know that the interest the saver earns is generated by the bank for lending out the money that the saver put in to save? The bank collects a fee for its expenses - and he risk that the borrower may default on the money (and that would mean that the you just lost your money, Mr. Saver!) The system has worked well for many years - but - outrageous lending and borrowing practices (actually quite dishonest and deceitful on the part of both lenders and borrowers - criminal fraud comes to mind…) has caused many distortions in the fabric fo our banking system. These distortions have ruined the finances of many innocent people. And, yes, some people who should right now be in jail have been rewarded with keeping their jobs and receiving bonuses!

It is easy at this time to see just how imperfect our system of justice is -and how things will be quite different when we face our Divine Judge who is Most Perfect.

God bless

 

[SHW]

The pope makes the definition of usury very clear. This appears to be a papal teaching on morals given wide distribution and intended as a teaching and binding on all Catholics.

“I. The nature of the sin called usury has its proper place and origin in a loan contract. This financial contract between consenting parties demands, by its very nature, that one return to another only as much as he has received. The sin rests on the fact that sometimes the creditor desires more than he has given. Therefore he contends some gain is owed him beyond that which he loaned, but any gain which exceeds the amount he gave is illicit and usurious.”

ON USURY AND OTHER DISHONEST PROFIT
Encyclical of Pope Benedict XIV promulgated on November 1, 1745.
papalencyclicals.net/Ben14/b14vixpe.htm

Thanks for the link. I consider my savings account an investment, not a loan.

III. By these remarks, however, We do not deny that at times together with the loan contract certain other titles-which are not at all intrinsic to the contract-may run parallel with it. From these other titles, entirely just and legitimate reasons arise to demand something over and above the amount due on the contract. Nor is it denied that it is very often possible for someone, by means of contracts differing entirely from loans, to spend and invest money legitimately either to provide oneself with an annual income or to engage in legitimate trade and business. From these types of contracts honest gain may be made.

This is from the same link that you posted above. I hope this helps make Catholic teaching more clear. I am definitely investing my money legitimately in order to be able to provide myself with an annual income right now. I am entitled to make an honest gain from my investment in the bank.

 

[SHW]

Hi, SHW,

I agree with you on this…

But, do you know that the interest the saver earns is generated by the bank for lending out the money that the saver put in to save? The bank collects a fee for its expenses - and he risk that the borrower may default on the money (and that would mean that the you just lost your money, Mr. Saver!) The system has worked well for many years - but - outrageous lending and borrowing practices (actually quite dishonest and deceitful on the part of both lenders and borrowers - criminal fraud comes to mind…) has caused many distortions in the fabric fo our banking system. These distortions have ruined the finances of many innocent people. And, yes, some people who should right now be in jail have been rewarded with keeping their jobs and receiving bonuses!

It is easy at this time to see just how imperfect our system of justice is -and how things will be quite different when we face our Divine Judge who is Most Perfect.

God bless

I agree. For now, the Federal Govt. guarantees FDIC savings accounts up to certain dollar amount ceilings, but if this insurance ends, then we can lose every penny just like they did years ago when banks made bad loans and then went bankrupt because they were not repaid.

The banking system is indeed corrupted, but we have so few choices for “investments” when we only have a small amount to invest. Owning stocks can be “tricky” also from a moral standpoint.

 

[Just_Lurking]

This is from the same link that you posted above. I hope this helps make Catholic teaching more clear. I am definitely investing my money legitimately in order to be able to provide myself with an annual income right now. I am entitled to make an honest gain from my investment in the bank.

So your theory is that that bank paying you interest is “not at all intrinsic” to you having money deposited with them? Do tell, as I would love to collect interest from your bank as well, although I don’t have any money to deposit with them at the present time.

 

[WillieWonka]

Thanks for the link. I consider my savings account an investment, not a loan.

This is from the same link that you posted above. I hope this helps make Catholic teaching more clear. I am definitely investing my money legitimately in order to be able to provide myself with an annual income right now. I am entitled to make an honest gain from my investment in the bank.

I can’t speak to your investments, but with a savings account one gives money to a bank. The bank then loans it out and is paid back more than they loan. Then they pay you more than you deposited with the profit they make on the loan.

With a bond, one gives money to the issuer, and after a defined period the issuer gives you back more than you gave him.

Both the savings accout and the bond fall squarely under the pope’s definition of unacceptable practices.

It appears Catholic teaching has changed on a matter of morality.

 

[TMC]

I can’t speak to your investments, but with a savings account one gives money to a bank. The bank then loans it out and is paid back more than they loan. Then they pay you more than you deposited with the profit they make on the loan.

With a bond, one gives money to the issuer, and after a defined period the issuer gives you back more than you gave him.

Both the savings accout and the bond fall squarely under the pope’s definition of unacceptable practices.

It appears Catholic teaching has changed on a matter of morality.

Yes, and no. The underlying principle is unchanged, but the application of that principle has changed because of changes in the world. The principles are that those with more should not unfairly take advantage of those with less, and that we should not condition helping others on receiving something in return. Those principles work out to different results in today’s economy than they did hundreds and thousands of years ago.

 

[WillieWonka]

I agree. For now, the Federal Govt. guarantees FDIC savings accounts up to certain dollar amount ceilings, but if this insurance ends, then we can lose every penny just like they did years ago when banks made bad loans and then went bankrupt because they were not repaid.

The banking system is indeed corrupted, but we have so few choices for “investments” when we only have a small amount to invest. Owning stocks can be “tricky” also from a moral standpoint.

What makes the banking system corrupt? Are you speaking of investment banking or commercial banking? Both have been an integral part of a system that has delivered more prosperity to more people than any other system in history.

The federal deposit insirance was introduced in the Depression bacause of bank failures. However, state government regulation had a hand in the failures. The vast bulk of bank failures happenned in states that did not allow branch banking. These laws protected the local bank from competition from larger banks.

However, the local bank was usually very dependent on the local economy. So, if thet local economy took a hit, the bank was likely to fail.

In states that allowed branch banking, larger banks had branches spread across the state. That meant ther branches were in locales with different economic bases. One might be in a wheat growing area. Another might be in a river port town. Another might be in a manufacturing area. So, the diversity of economic bases gave the larger bank less total risk exposure.

When failures happenned in no-branch states, rather than fix the branch restrictions, politicians decided to leave the restrictions in place and give insurance.

Insurance exacerbates the problem as we saw in the saving & Loan problem in the Eighties. Investors have no incentive to look at the stability of the institution in which they place their money. They know they can’t lose it because it is insured.

Note Canada had no bank failures in the Depression, yet it faced the exact same economic situation the US faced. Their banks could operate anywhere in the country.

 

[WillieWonka]

Yes, and no. The underlying principle is unchanged, but the application of that principle has changed because of changes in the world. The principles are that those with more should not unfairly take advantage of those with less, and that we should not condition helping others on receiving something in return. Those principles work out to different results in today’s economy than they did hundreds and thousands of years ago.

Those may be principles, but they are not the ones the pope invoked in the encyclical. The pope very clearly stated, “any gain which exceeds the amount he gave is illicit and usurious.” He didn’t say an unfair gain was prohibited. He said **any **gain was usury and prohibited. There’s not much wiggle room there.

Had he said what you say, I would agree. But he didn’t. Nor did he limit his teaching to some particular time.

 

[SHW]

I can’t speak to your investments, but with a savings account one gives money to a bank. The bank then loans it out and is paid back more than they loan. Then they pay you more than you deposited with the profit they make on the loan.

With a bond, one gives money to the issuer, and after a defined period the issuer gives you back more than you gave him.

Both the savings accout and the bond fall squarely under the pope’s definition of unacceptable practices.

It appears Catholic teaching has changed on a matter of morality.

What do you suggest instead as an alternative investment, in order for Catholics to make an honest gain on their “life savings” so as to not lose its value to inflation so that they will be able to take care of themselves in their old age, since you believe that savings accounts in banks are evil?

Catholics would then need to keep their money under their mattresses or hidden someplace else in their homes even though it can and would be stolen from them because everyone would soon know that Catholics have money hidden in their homes (if the pope makes a decree that they could no longer use banks because they are evil). The pope will need to shut down the Vatican Bank, too.

Lives will be put in extreme danger because thugs will target our homes for break-ins for easy pickings. They can just follow us home from church in order to know who to “hit” next, and then rob us whether we are home or not since home invasions are becoming more popular now.

It is my opinion that banks serve good purposes when morally managed.

 

[Langdell]

Hi,

I have not read the whole encyclical, but if you take into account the time value of money, then a lender who charges a reasonable rate of interest isn’t getting back more than he gave, while the lender who charges no interest is getting back less than he gave.

When someone else has the use of your money, you can’t use it yourself. For example, say you loan someone $20 in May at zero interest for six months. If you had that $20, you would have bought tomato seedlings, which would eventually have produced tomatoes worth, say, $25. In other words, at the end of six months you would have been richer (in tomatoes) if you had been able to put the $20 to work for yourself. But instead the borrower is using the $20, and at the end of six months, if he repays you, you still have only $20. By not charging interest, you’ve given the borrower $5 in value that you’re not getting back.

Respectfully submitted.