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That Wolf Street article deals with the fact that Spanish banks are employing a trick used by Barclays Bank a few years ago, namely creating money out of thin air and lending to people on condition they buy shares in the relevant bank.
I argued yesterday on my blog that there was nothing wrong with that. But having slept on the problem, I now think that fake bank capital is not acceptable. See respectively:
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That Wolf Street article deals with the fact that Spanish banks are employing a trick used by Barclays Bank a few years ago, namely creating money out of thin air and lending to people on condition they buy shares in the relevant bank.
I argued yesterday on my blog that there was nothing wrong with that. But having slept on the problem, I now think that fake bank capital is not acceptable. See respectively:
http://ralphanomics.blogspot.co.uk/2016/06/does-barclays-style-fake-bank-capital.html
http://ralphanomics.blogspot.co.uk/2016/06/spanish-banks-fake-capital.html
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