Modernising money: why our monetary system is broken and how it can be fixed by Andrew Jackson & Ben Dyson Summary

1. Banks create 97% of money as bank deposits through risky lending practices.
2. Modernising Money proposes separating risk-free transaction accounts from investment accounts.
3. Bank-created money fuels housing bubbles and wealth inequality instead of productive growth.
4. Debt-free money creation by public bodies could fund infrastructure without increasing national debt.
5. Current banking privatizes profits from money creation while socializing losses through bailouts.
6. The UK monetary system lets banks create electronic money through simple ledger entries.
7. Proposed reforms would allow bank failures without collapsing payment systems or deposits.
8. Interest payments on private debt drive climate-damaging growth requirements and recession risks.
9. Central banks should create money for public benefit rather than private bank profits.
10. Modernising Money reveals how banking reform could stabilize economies and reduce boom-bust cycles.
11. Current system prioritizes bank liquidity over sustainable lending to businesses and households.
12. Jackson-Dyson reforms align money creation with economic capacity rather than debt markets.

About the Author of Modernising money

Andrew Jackson and Ben Dyson are the co-authors of Modernising Money: Why Our Monetary System is Broken and How It Can Be Fixed. Both are leading voices in monetary reform and banking system redesign.

Jackson is a researcher specializing in money creation mechanisms, while Dyson is the founder of the advocacy group Positive Money. Together, they combine academic rigor with practical policy insights to address systemic financial instability.

Their work critiques private bank-dominated money creation, advocating for debt-free currency issuance and structural reforms to promote economic resilience. Dyson’s background in development economics and entrepreneurial experience informs the book’s accessible, solutions-oriented approach, while Jackson’s analytical frameworks ground its proposals in historical and economic context.

Modernising Money has been endorsed by figures like Herman Daly and cited in policy discussions. The book has been downloaded globally as a free resource, reflecting the authors’ commitment to democratizing financial literacy, and their ideas have influenced debates on central bank digital currencies and sovereign money systems.

FAQs About Modernising money

What is Modernising Money by Andrew Jackson and Ben Dyson about?

Modernising Money critiques the current monetary system where 97% of money is created by private banks as interest-bearing debt, leading to economic instability, inequality, and environmental harm. The authors propose transferring money creation to an independent public body, arguing this would reduce debt, stabilize economies, and align investment with societal needs. The book combines historical analysis with reform proposals to create a transparent, accountable system.

Who should read Modernising Money?

This book is ideal for policymakers, economists, and anyone seeking to understand systemic flaws in modern banking. It’s accessible to non-experts, offering clear explanations of complex monetary mechanics and advocating for structural reforms. Readers interested in debt reduction, financial stability, or addressing climate change through economic policy will find it particularly relevant.

What are the main arguments in Modernising Money?

The authors argue that private banks’ ability to create money through loans fuels asset bubbles (e.g., housing crises), exacerbates inequality via interest payments, and prioritizes profit over public good. They demonstrate how debt-driven money creation forces unsustainable growth, harms the environment, and centralizes power in unelected financial institutions.

How does Modernising Money propose fixing the monetary system?

Key reforms include:

• Restricting money creation to a public authority (e.g., the Bank of England).
• Separating banks’ transactional and investment activities to prevent risky lending.
• Introducing “debt-free” money to reduce reliance on interest-bearing loans.
• Directing investment toward productive, socially beneficial projects rather than speculative assets.

What is the significance of the 97% statistic cited in the book?

The book highlights that 97% of money in circulation originates as bank deposits created through loans, not government-issued currency. This system concentrates power in private banks, ties economic stability to debt repayment, and prioritizes short-term profits over long-term societal needs.

How does Modernising Money address environmental concerns?

By reducing debt-driven growth pressures, the proposed reforms would lessen the need for environmentally harmful industries to perpetually expand. Redirecting investment toward sustainable projects and stabilizing boom-bust cycles would also mitigate the erosion of environmental regulations during economic downturns.

What critiques does Modernising Money face?

Some economists argue public control of money could lead to inflationary mismanagement or political interference. The authors counter that independent oversight and transparent processes would prevent these issues, contrasting their plan with historical hyperinflation examples like Zimbabwe.

How does Modernising Money differ from other economics books?

Unlike works focused on superficial fixes, it targets systemic flaws in money creation itself. It combines technical banking mechanics with accessible explanations, offering a concrete legislative roadmap (e.g., updating the 1844 Bank Charter Act) rather than abstract theories.

Why is Modernising Money relevant in 2025?

With rising debt levels, climate urgency, and post-pandemic economic instability, the book’s call for structural reform resonates. Its proposals align with global debates about central bank digital currencies (CBDCs) and public control over financial systems.

What key quotes summarize Modernising Money’s message?

• “Money creation should serve the public interest, not private profit.”
• “Asset bubbles are not market failures but systemic features of debt-based money.”
• “A stable economy requires divorcing money from debt.”

How does Modernising Money relate to Positive Money?

Co-author Ben Dyson founded the Positive Money campaign, which advocates for the book’s reforms. The text expands on the group’s core ideas, providing academic rigor and policy details to support its grassroots initiatives.

Are there practical examples of the reforms in action?

While no country has fully adopted the proposals, elements like CBDCs and public banking initiatives reflect its principles. The book cites historical precedents, such as the 1844 UK Bank Charter Act, as frameworks for modern implementation.