Richard Mowbray's neo-conservative house of cards collapses with his first point (Letters, May 18).

The state is not a monopoly supplier of money, and this is where the crisis has originated.

Banks create 97% of money as loans, ie credit, and government creates 3% as coinage. Even quantitative easing is undertaken via commerical banks. The Bank of England has no control over distribution of these funds so it cannot work as a means of creating sustainable economic growth. Less than 20% of bank lending is to business and more than 80% is lent as mortgages, loans and for credit cards. The economy is entirely fuelled by debt.

The scattergun approach of attacking political naivety on the left is ill informed. All politicians have to act urgently and rein in the excesses of banks. We must return to full reserve banking from the edifice of fractional reserve banking with creation of the money supply in the hands of central banks where it can be created debt free. Boom and bust is the inherent sine wave of business activity in unregulated markets.

None of this begins to answer the crucial question of how economic growth can be legitimately pursued on a finite planet. For that we need to move beyond GDP and look at how we can successfully pursue health and happiness, neither of which can be realised through personal wealth alone.

Tony Philpin,

Kinnereach, Isle of Gigha.