Saturday, November 22, 2014 — MPs debated money creation and society

Watch the debate and read the transcript 
The debate was opened by Steve Baker at 11.18am. Shadow Treasury Minister, Catherine McKinnell, responded to the debate on behalf of the Opposition. The Economic Secretary to the Treasury, Andrea Leadsom, responded to the debate on behalf of the Government. 
Watch Parliament TV: MPs debate money creation and society, Thursday 20 November 2014 
Read the debate in Hansard. 
Read Commons Hansard: MPs debate money creation and society, Thursday 20 November 2014
MPs debated money creation and society


Background and prognosis.

The Financial Times — FT Alphaville
Private money vs totally-public money, plus some history
Izabella Kaminska


NeilW said...

18 MPs were there. Out of a total of 650.

Complete waste of parliamentary time talking about a philosophical irrelevance.

It's no wonder we can never get to a decision about what to do with banks when there is all this nonsense floating around. Crypto-currencies and balance sheet adjustments don't improve control points or fraud management.

Ralph Musgrave said...

There’s quite a few Nobel Laureate economists who have backed the sort of proposal debated in the UK parliament: Milton Friedman, Messers Modigiani and Miller (inventors of the MM theory), James Tobin, etc. Rather than examine their reasons in detail, Neil regularly produces one liner put downs. I think we can safely ignore most of Neil’s one liners.

Re Neil’s point that the above proposals don’t improve “fraud management”, that is totally irrelevant because advocates of full reserve banking do not claim that fraud management is an important merit in FR. However, as it happens FR does reduce fraud SOMEWHAT, and for the following reasons.

Under the existing system, banks are free, so to speak to use grandma’s savings to bet on dodgy derivatives, fund NINJA mortgages etc. In contrast, under FR, those who fund loans decide what is done with their money and for the simple reason that THEY bear the loss when it all goes wrong, not the taxpayer. (Presumably Neil is in favour of taxpayers bailing out Wall Street bankster / criminals.)

Thus under FR anyone particularly wanting to fund dodgy derivative bets or NINJA mortgages is free to do so. However, I’d guess very few people would want to. To that extent, sharp practice / fraud is reduced.