At the 2007 Summer Institute Bernard Lietaer sent a shudder through the program community with his presentation on global financial systems. Bernard is renowned as one of the architects of the Euro and as an expert on complementary currencies. He began his presentation by quoting Paul Volcker, former Chairman of the U.S. Federal Reserve, who predicted a “hard landing” of the dollar within five years. The quote was dated 2005.

Bernard linked the inherent dysfunctions of our monetary system with the rise of the “unhealthy masculine archetype” in modern history. Certainly we are seeing how financial systems have become increasingly disconnected from real value and a real economy–one that obeys the laws of living systems. As Bernard also pointed out, money is not a neutral force but a powerful blind spot and driver behind other social and environmental breakdowns.

The following video explains the illusory but destructive nature of our global financial systems in easy-to-follow terms.  As another economist, Tony Lamport, recently commented, “Explaining the solution poses a somewhat bigger challenge.”

Money as Debt

Also see this financial Crisis Explainer, a simple whiteboard presentation by Marketplace Senior Editor Paddy Hirsch on the challenges currently facing the financial sector.