Having a chat with ChatGPT about money

So, somehow the bot understand its a fictitious system.
Now i understand why "they" want AI on pause...

Here is the chat:

USER:
i wonder how the very first bank started on earth

CHATGPT:
The history of banking and finance dates back thousands of years, and the origins of banking can be traced to ancient civilizations such as Mesopotamia, Egypt, and Greece.

One of the earliest known banking institutions was the Temple of Babylon, which operated in Mesopotamia around 2000 BC. The Temple served as a place of storage for goods and grains, and it also provided loans to farmers and merchants. Similarly, the ancient Egyptians had a system of grain banks that provided loans to farmers and were used to store excess crops.

In ancient Greece, there were moneylenders who provided loans at high interest rates, and in Rome, there were institutions known as argentarii that provided banking services such as deposits, loans, and money transfers.

Over time, the practice of banking evolved and spread throughout the world, with the establishment of banks and financial institutions in Europe during the Middle Ages, the development of modern banking systems in the 19th and 20th centuries, and the emergence of digital banking and fintech in the modern era.

So while it's difficult to identify a single "first bank" in history, the origins of banking can be traced back to the earliest civilizations, where institutions such as temples, grain banks, and moneylenders provided financial services to their communities.




USER:
lets say im the first bank in history. I have 100 coins in the bank. You come to my bank and loans 10 coins at the interest rate of 10%. so your first payment will be ?

CHATGPT:
If you borrowed 10 coins at an interest rate of 10%, your total debt would be 11 coins (10 coins for the principal amount borrowed, plus 1 coin in interest).

Assuming that you have agreed to make one lump sum payment at the end of the loan term, your final payment would be 11 coins.

If, however, you have agreed to make regular payments over time, the amount and timing of each payment would depend on the terms of your loan agreement. For example, if you agreed to repay the loan in equal monthly installments over the course of a year, you would need to make 12 monthly payments of approximately 1 coin each (plus interest) to fully repay the loan.




USER:
but where do you get that 1 extra coin from?

CHATGPT:
The additional coin in the scenario I described would represent the interest on the loan. When you borrowed 10 coins from the bank at an interest rate of 10%, the bank would expect you to repay a total of 11 coins (10 coins for the principal amount borrowed, and 1 coin for the interest).

The bank earns this interest as a profit on the loan, which compensates the bank for the risk and opportunity cost associated with lending out its funds. The interest earned by the bank may be used to cover its operating expenses, pay dividends to shareholders, or reinvest in the business.




USER:
but there is only 100 coins total. How did the extra coin appear?

CHATGPT:
You raise a valid point - in the scenario you described where there are only 100 coins in the bank, it would not be possible to lend out 10 coins at an interest rate of 10% without creating new coins or obtaining additional funds from elsewhere.

In reality, the creation of new coins or the acquisition of additional funds would likely be outside the scope of a simple early banking system.

One way that early banks might have addressed this issue is by charging a higher interest rate to compensate for the limited pool of available funds. Alternatively, the bank might have required collateral or some other form of security to back the loan, in order to reduce the risk of default and the need for additional funds.

It's worth noting, however, that the scenario you described is a simplified example of how a loan might work, and in practice there would likely be many more variables and factors to consider.




USER:
so simply saying, my bank would make coins out of thin air?

CHATGPT:
No, banks do not typically create new physical coins to lend out. Instead, banks create new money electronically when they make loans.

When you take out a loan from a bank, the bank does not actually transfer existing money from its reserves to your account. Instead, the bank creates a new deposit in your name, which effectively creates new money in the economy. This is known as the "money creation process".

Banks are able to do this because they are only required to hold a fraction of their deposits in reserve (known as the reserve requirement), while the rest can be loaned out and create new deposits. This is called fractional reserve banking.

It's worth noting that this is a simplified explanation of a complex process, and different countries and banking systems may have their own specific regulations and procedures.




USER:
but this would only work in the electronically world. Not in the real world?

CHATGPT:
Correct, the creation of new money through electronic deposits is specific to modern banking systems, which rely heavily on digital transactions. In the past, when physical currency was the primary means of exchange, banks would not have been able to create new coins or bills out of thin air.

Instead, banks would have had to rely on the physical currency that was in circulation, as well as deposits from customers, to make loans. This would have placed limitations on the amount of money that banks could lend out, since they would not have been able to create new money in the same way that modern banks can through electronic deposits.




USER:
would that mean, that money is really a fictitious thing?

CHATGPT:
In a sense, yes - money is a social construct that has value because people agree to treat it as such. The physical currency we use to make purchases is essentially just pieces of paper or metal, and their value comes from the fact that we collectively agree that they can be exchanged for goods and services.

In modern economies, most money exists in electronic form, and its value is based on trust in the financial system and the government that backs it. As we've discussed, banks are able to create new money electronically through the lending process, which can increase the money supply and affect the overall economy.

Overall, the value of money is a complex and multifaceted concept, influenced by economic, political, and social factors, as well as individual beliefs and perceptions.

The thing with the electronic money is that when the electricity goes down the world freezes and it's going to be a very sad sack of crap when that happens one person said that his father said that the world can collapse or the country collapse in one hour.

originally posted by: musicismagic
The thing with the electronic money is that when the electricity goes down the world freezes and it's going to be a very sad sack of crap when that happens one person said that his father said that the world can collapse or the country collapse in one hour.

I don't think it would require a full 60 minutes to collapse.

Looking at things the way they are, I am beginning to think that it may be like a termite consumed wall.

It looks solid, but don't lean on it.

originally posted by: NightSkyeB4Dawn

I don't think it would require a full 60 minutes to collapse.

Looking at things the way they are, I am beginning to think that it may be like a termite consumed wall.

It looks solid, but don't lean on it.

I was thinking about your post, and it occurred to me that it all depends on how you define 'collapse.'

Within the first 10 minutes we would have, in the more civilized parts of the world, a complete migration to heightened stress, some emotional brake-downs, and no small degree of panic.

Imagine a world where suddenly all communications ceased - outside of the people around you. No one will be able to reach anyone they care about; relying on phones and other equipment which just won't work. In a few minutes, the world will be full of screaming devices, trying to reach a 'service' which no longer exists.

From that moment forward, most everyone will be of a mind to 'get to a certain place, or person' ... without any real control mechanisms, it will become a churning sea of people, all moving one way or another, trying to close in on their destinations. Will they cooperate, or shove and push each other out of the way? How many will cling to the idea that 'all will be well' and insist on spending their time trying and trying again to 'connect' with their devices? How many will simply have no idea of how to proceed?

Would that be considered a collapse? Maybe it would be. From that moment forward, there are no answers... only efforts, most in vain.

I think 10 minutes... after that, the unraveling begins.

a reply to: Maxmars

If the food supply chain grinds to a halt and critical infrastructure is hacked so that your water is cut off, in less than a month the elites will have achieved a global population reduction down to 500 million.


This is more than mere speculation.

In 2007 a new type of virus appeared on the internet called Storm Worm. The amount of computers estimated to be infected is in the millions. Since 2007 up until present day nobody knows what its purpose is but if I understand it correctly it has the ability to turn those millions of computers into zombie followers and execute ddos attacks and basically shut down whatever it wants to shut down.

It has been labeled the perfect storm just waiting to happen.





The day when things go really wrong is as close to us as the push of a single button, in more ways than one.

I've said it before that money is simply an accounting device used to keep track of the amount of work/services a person has provided and the goods we have acquired. Money is just a tally system, not something with intrinsic value in itself.

Back in simpler times, a person would work for someone who would provide their living needs in return. Or a perspn would barter something(s) in return for one other thing(s). Money was not required to keep track of these starightforward transactions.

However, once it gets more complicated -- such as the work I do for you is worth me getting my living needs from you, but I worked extra hard so I can also get a bag of apples from the farmer 2 miles away -- that's when money started becoming the way to keep track of the work I did.

Example: I help the baker bake. I get bread and a room, but I also want apples. The baker has no apples, but knows an farmer who buys bread from the baker. The baker gives me bread, my room, plus a little piece of paper that says "the holder of this paper did enough work for me for him to be able to trade this papepr for a bag of apples-- AND in return for you accepting this paper from him, you can return this paper to me and get a loaf of bread.

That paper itself has no intrinsic value, but the baker, baker's helper, and apple farmer have all agreed that it can show a unit of work worth one bag of apples or one loaf of bread has been perfomed.

a reply to: Soylent Green Is People

And yes...

The value of money is the issue.

It has no value, yet it has become an industrial-scale effort to make money 'yield' more money.

The problem has never been "money" it has always been that those who get the 'authority' to create it ... want money for creating it...

.. they also want money for 'holding it' and for 'moving it' and for 'every single transaction' they can imagine ...

... in exchange for granting them that 'power' they offer.... money.

Eliminate monetary monopolies, create and foster sovereign currency, outlaw egregious fractional reserve lending... take the casino out of the market.

As someone once said... It is the love of money that has always been the problem.

Money is an illusion, like power, like belief, created to control the masses.