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.
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Monday, December 14, 2020
Trump Regulator Set to Consider Approving the Banking Model that Ushered in the Great Depression – Uninsured Deposits — Pam and Russ Martens
So who's forcing people to use uninsured banks? And aren't investment banks uninsured?
The true crime is having only a SINGLE payment system - one that must work through private banks or not all - instead of allowing all citizens (at least) to have inherently risk-free accounts of their own at the Central Bank or Treasury.
It's maddening that the so-called idealistic US can't seem to grasp that government privileges for private credit creation is inherently corrupt.
I quite agree with Andrew. As long as everyone can open an account with govt or central bank (e.g. CBDC) there is no reason for taxpayers to have to stand behind private bank accounts.
In the UK and doubtless some other countries, people have actually long been able to store money with govt: at the UK’s state run savings bank, “National Savings and Investments”. NSI isn't QUITE AS flexible as a normal bank account (e.g. they don’t issue debit cards). But with a few improvements, like debit cards, NSI would be as good as CBDC.
Giving govt backing to private bank accounts essentially means private banks (when they create money) are creating central bank issued money: effectively creating $100 bills. Thus private banks make seigniorage profits that way, which is unacceptable.
The system which bans the latter practice is sometimes called “full reserve” banking. I’ve listed about sixty economists who back full reserve here:
MintMefasdasd
ReplyDeletehttp://www.mintme.comdfsfs
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I thought the Trump regulator worked for twitter.
ReplyDeleteMintMe is an example of a gift economy.
ReplyDeleteSo who's forcing people to use uninsured banks? And aren't investment banks uninsured?
ReplyDeleteThe true crime is having only a SINGLE payment system - one that must work through private banks or not all - instead of allowing all citizens (at least) to have inherently risk-free accounts of their own at the Central Bank or Treasury.
It's maddening that the so-called idealistic US can't seem to grasp that government privileges for private credit creation is inherently corrupt.
I quite agree with Andrew. As long as everyone can open an account with govt or central bank (e.g. CBDC) there is no reason for taxpayers to have to stand behind private bank accounts.
ReplyDeleteIn the UK and doubtless some other countries, people have actually long been able to store money with govt: at the UK’s state run savings bank, “National Savings and Investments”. NSI isn't QUITE AS flexible as a normal bank account (e.g. they don’t issue debit cards). But with a few improvements, like debit cards, NSI would be as good as CBDC.
Giving govt backing to private bank accounts essentially means private banks (when they create money) are creating central bank issued money: effectively creating $100 bills. Thus private banks make seigniorage profits that way, which is unacceptable.
The system which bans the latter practice is sometimes called “full reserve” banking. I’ve listed about sixty economists who back full reserve here:
https://fractionalreserveisnonsense.weebly.com/more-on-full--fractional-reserve.html