Peter Mandelson demonstrates his ignorance of our monetary system

When Peter Mandelson appeared on the Andrew Marr show on 22 Dec 2013, he was asked about the state of economy. He said "we've got to see people earning more and their personal indebtedness reduce". Unfortunately, under our current fractional reserve monetary system, most of the money supply is created by people's personal indebtedness; reducing that, will reduce the amount of money available for people to earn! Its impossible to achieve what he's asking for without changing our monetary system.