There are many different ways to explain Silvio Gesell's concepts of the Natural Economic Order. The one I prefer is quite simple - we (and when I say we I mean the global economy as whole, especially the most developed countries) should move from taxing transactions through income and sales taxes to taxing passively hoarded wealth through natural rent and financial levy.
The main characteristic of the modern economy is abundance of financial capital and scarcity of investment returns. As a result investment risks overweigh potential returns and money is passively hoarded, which in turn suppresses business revenues further, creating a vicious circle of recession.
The only solution the mainstream economics knows today is to inject new money either through fiscal stimuli, which is preferred by the "Left" or through banking lending, which is preferred by the "Right". The former means that Government should issue new bonds and invest, the latter means that banking system should create new money and lend them to households to boost private spending. Neither is sustainable long term. Private overspending is not sustainable even short term. Remember the 2008 crash? It was caused by the very excessive private debt.
Freigeld offers a different approach - instead of constantly creating new money, lets encourage velocity of the existing stock. Let's make money change hands, and while this takes place, new real wealth will be created in the economy.
Think a moment about a source of savings in an economy with a fixed money stock and you immediately understand why you have only two options - either print more money to increase paper wealth, or encourage velocity of existing money to increase the real, non-monetary savings. The latter include: getting better houses and cars; securing supply of vital goods and services; investing in healthcare and education; having an opportunity to run your own businesses; pension pots which invest in multitude of thriving companies; and so on.
If there is a trillion dollars in an economy, whatever hard all people work, they cannot grow their monetary savings altogether. You can try to hoard money depriving your neighbour in their income, but eventually it will be a lose lose situation for everyone as the real wealth in a stagnant economy decays. Instead of trying to achieve unachieaveable we should accept that money is a tool to build wealth, but not the wealth itself. Money is our servant, not the master.
This is essentially what Freigeld is about.
@moneytree Well done for sticking at it! Followed.
Thanks. I was trying to understand what may work on steemit better, but Freigeld is what I am genuinely interested in! Followed back