An economics, investment, trading and policy blog with a focus on Modern Monetary Theory (MMT). We seek the truth, avoid the mainstream and are virulently anti-neoliberalism.
This was good (on argument that since the money-tokens that circulate have often/usually been privately created credit-tokens, they must stay that way)
"For 5000 years there have always been sailing ships. To have any other sort of ship is not possible, it would be like having “dry water.”
All historic reports of successful internally powered ships must be false. Anyway, we do not want such ships, despite simulations showing that they are better than sailing ships. We think that our needs are best served by making improvements to sailing ships.
Have to go now, just off to the yacht club dinner."
Even with full reserve banking, bank deposits are liabilities of private banks. So the money-token that would "circulate" under full reserve banking would still be privately created credit-tokens, just credit tokens that are always 100% backed by state money tokens.
Of course the token notes that would circulate physically would be state money tokens, just as they are now.
The only difference is that bank liabiities (which don't actually "circulate" by the way) would be fully backed by credits at the central bank or treasury.
4 comments:
This was good (on argument that since the money-tokens that circulate have often/usually been privately created credit-tokens, they must stay that way)
"For 5000 years there have always been sailing ships. To have any other sort of ship is not possible, it would be like having “dry water.”
All historic reports of successful internally powered ships must be false. Anyway, we do not want such ships, despite simulations showing that they are better than sailing ships. We think that our needs are best served by making improvements to sailing ships.
Have to go now, just off to the yacht club dinner."
(comment here)
Clint Ballinger: On good urbanism, sane economics, & problems in the social sciences
Even with full reserve banking, bank deposits are liabilities of private banks. So the money-token that would "circulate" under full reserve banking would still be privately created credit-tokens, just credit tokens that are always 100% backed by state money tokens.
Of course the token notes that would circulate physically would be state money tokens, just as they are now.
The only difference is that bank liabiities (which don't actually "circulate" by the way) would be fully backed by credits at the central bank or treasury.
It's not about full reserve banking. Its about no reserve banking and digital greenbacks.
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