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These full reserve people are really confused about banking. For example:
"How can anyone keep the economy on an even keel if the money supply is a free-for-all?
It’s not a free-for-all, just a free-for-all-licensed-banks."
How is bank lending a free for all? Does this person even know how bank regulation works? Last time I checked, getting a bank loan is pretty difficult.
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To make electronic money issuance the prerogative of the state, like with physical cash. State e-money. People would keep deposits in the central bank"
LOL so the Govt is going to open tens of thousands of Fed offices around the country? Or they dont and then nobody can use the Fed bank and so they use private commercial banks whose collateral assets tturn to shit in a downturn and bankrupt millions of regular Americans. Honestly, this type of plan is so stupid, its hard to even do a proper analysis. We've done this banking thing for hundreds of years, and there are generally no problems when things are going fine, but when you have a crash, all your paper capital turns to shit and you need to be bailed out anyway. Unless your capital is nothing but Govt IOUs then you wouldnt be changing anything anyway s the Govt would always have to provide enough of its IOUs to set its desired interest rate.
3 comments:
These full reserve people are really confused about banking. For example:
"How can anyone keep the economy on an even keel if the money supply is a free-for-all?
It’s not a free-for-all, just a free-for-all-licensed-banks."
How is bank lending a free for all? Does this person even know how bank regulation works? Last time I checked, getting a bank loan is pretty difficult.
"High quality global journalism requires investment. Please share this article with others using the link below, do not cut & paste the article. See our Ts&Cs and Copyright Policy for more detail. Email ftsales.support@ft.com to buy additional rights. http://www.ft.com/cms/s/0/a0942ee6-9a98-11e5-be4f-0abd1978acaa.html#ixzz3ta5Evyzu
To make electronic money issuance the prerogative of the state, like with physical cash. State e-money.
People would keep deposits in the central bank"
LOL so the Govt is going to open tens of thousands of Fed offices around the country? Or they dont and then nobody can use the Fed bank and so they use private commercial banks whose collateral assets tturn to shit in a downturn and bankrupt millions of regular Americans. Honestly, this type of plan is so stupid, its hard to even do a proper analysis. We've done this banking thing for hundreds of years, and there are generally no problems when things are going fine, but when you have a crash, all your paper capital turns to shit and you need to be bailed out anyway. Unless your capital is nothing but Govt IOUs then you wouldnt be changing anything anyway s the Govt would always have to provide enough of its IOUs to set its desired interest rate.
Martin Sandbu's article was intended to be humorous, and perhaps he didn't intend it to be high standard either.
In contrast, the four or five comments by me after the article were of course of an impeccably high standard...:-)
"In contrast, the four or five comments by me after the article were of course of an impeccably high standard"
Time to seek help for that narcissistic personality disorder before you turn into an economist. ;-)
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