We will continue to arbitrarily create money, and create incentives which force us into subpar investments in order to motivate people to take out loans they otherwise wouldn't have, in order to work to create products there wasn't otherwise enough demand for, and in the meantime the middleman will collect the fees for their "work" in managing these "investments".
Really kind of reminds me of Rick and Mortys microverse episode.
His claim seems to be that usury is when interest is charged on loans where the lender has full recourse to the borrower in case of default.
Without interest (or fees) on loans then anyone lending money would have to take an active interest in the business as a proper partner or shareholder, which is a lot of overhead and headache for everyone involved.
Though I suppose keeping it impersonal and at arm's length like this has pros and cons, I think it's what I would prefer personally in most cases as a borrower.
Another alternative of course is not borrowing money but that would tend to limit business ventures to those with minimal setup costs that start nearly cash-flow positive - or initiated by the already wealthy elite.
So, basically what you mentioned. And yes, it does involve more work. But that's how life is if you want to be fair. The alternative with lending money with interest is that now the lendee owes you money just for simply borrowing money. We see what this practice gave us when we look at the current financial situation (in its many forms, bonds for example are a form of usury). It is a predatory practice. Simply making money for having money is extremely dangerous and unethical. You have to work to make money, either by putting in effort to do physical labor, or by doing your research in deciding whom to invest your money with, etc. You can't get money "for free" (I realize that nothing is 100% guaranteed, e.g. if the lendee declares bankruptcy, but the contract itself is predatory).
It's number 58: http://www.jewfaq.org/613.htm
They also have a mitzvot that one shall not lend to another jew with interest. It's number 171
To be clear. I acknowledge there is a difference between lending with interest and usury
Its not some nefarious scheme, its just the best way that has arisen to do things thus far. It wasn't "designed" or "planned" and in order to make the system more efficient, a new method of transactions needs to be established, and many groups are working hard to come up with a cryptocurrency to solve this problem.
Regarding interest and "usury" there is no difference, because there is no definition for "unreasonable" interest. I have an irresponsible friend, that I know if I give $100 to, there's a 1% chance that I will get my money back. So than why would I give him money at a rate that would be unprofitable for me when I can do other more useful things with it? Say I have another friend who I have good reason to believe will give me back my money 99% within our agreement. Obviously the second would get a better interest rate because there is less risk and he might be more useful with the money than I could be.
How do you calculate risk? Well let 10,000 other people with money offer him better terms (driving down the interest rate) if they think my judgement is wrong, and if it turns out to be the case they make money, if not they lose money.
Its not for you to say, ALL Investors you have to get involved with the business, for one, the person receiving the money might not want to give up control, nor the investor give it, because that might not be his area of expertise. Then again, maybe it is, and you have specific investors called VC's that do get involved.
Its actually ridiculous that people in the 21st century could consider the usury argument valid and actually praise Dogmatism. The greater concern is actually about creating and maintaining a competitive marketplace of creators and investors, then about the rates they charge -which is determined by simple supply and demand.
Try limiting the rates to your definition of "Fair", see what happens. Hint: Google "the cobra effect".