Forum Replies Created
-
AuthorPosts
-
LuckyInOC
Participant[quote=racer76]Most of the cheapskates on here would never spend money on HBO![/quote]
My wife called DishNetwork (3 years of service) and got them to give us 3 free mos of HBO & Starz. She should be a buyer for the Gov’t. Our deficit would be gone in a year…
Lucky In OC
Participant[quote=racer76]Most of the cheapskates on here would never spend money on HBO![/quote]
My wife called DishNetwork (3 years of service) and got them to give us 3 free mos of HBO & Starz. She should be a buyer for the Gov’t. Our deficit would be gone in a year…
Lucky In OC
Participant[quote=racer76]Most of the cheapskates on here would never spend money on HBO![/quote]
My wife called DishNetwork (3 years of service) and got them to give us 3 free mos of HBO & Starz. She should be a buyer for the Gov’t. Our deficit would be gone in a year…
Lucky In OC
Participant[quote=racer76]Most of the cheapskates on here would never spend money on HBO![/quote]
My wife called DishNetwork (3 years of service) and got them to give us 3 free mos of HBO & Starz. She should be a buyer for the Gov’t. Our deficit would be gone in a year…
Lucky In OC
Participant[quote=davelj]I mostly agree with Breeze and peterb. There’s nothing inherently wrong with fractional reserve banking and it has one enormous advantage over non-fractional reserve banking: lower interest rates. Look at the interest rate spreads between mortgages and government debt in countries where there is no or limited fractional reserve banking – they’re through the roof. Why? A thought experiment to explain part of the reason. Let’s say I want to start a bank and earn 10% on my equity. Fractional reserve banking allows me to lever up my equity, thereby lowering the necessary spread between my cost of borrowing (deposits) and lending (loans). Holding return on assets constant, my return on equity increases with leverage. So, let’s say I can lever 10-1, earn 1% on assets and achieve a 10% ROE. Now, let’s eliminate fractional reserve banking and now I have to fund entirely with equity. Now I have to earn a 10% ROA. If my cost of deposits is 3% and operating costs are 2%, then I have to charge 15% on my loans to make it worth my while. Anybody want 15% mortgages? Then eliminate fractional reserve lending and your wish shall be granted in short order.
Personally, I don’t have a problem with 20% down mortgages. Recall, that without the 0%, 5%, 10%, etc.-down mortgages, we never would have had the bubble in the first place, so the 20% down mortgages wouldn’t currently be in jeaopardy. That is, if we had stuck to 20% down over the last 8 years we wouldn’t be in this mess in the first place. [/quote]
Banks don’t loan money and the same rate the pay depositors… There is always a 3-6% margin. But the bank’s return is more than 10x the depositors return.
If the bank pays 3% to depositors and charges 5% for loans, at 10:1, the bank would get 50% for every 3% paid or 47% revenue on deposits. The problem in your 10:1 scenario is 9 dollars will get redeposited in the banking system and show up as additional deposits. Now, the bank can loan another 8 dollars on the 9 dollars deposited that the bank ‘created’ and so on. It becomes not just 10:1, but about 56:1 in money supply. So, the bank makes 280% and pays out 30% or 250% revenue on deposits. Based on this, Depositors should be getting returns above the percentage of the loans, not below.
A bank has $100M on deposit. At the end, of the year it will have $47M in revenue without using any of its own money. Now, what do you think the current reserve policy of banks is 10%, 5%, 3%???
Transactions is 10%. All other accounts (Savings, CD’s, etc.) 0.00000% … ZERO, NIL, NOTHING, NADA… This is money value not created by Congress.
This is the 2nd source of inflation and the devaluation of the dollar. Who pays for this inflation? We all pay for this inflation to the banks because everyone increases their prices to pay for this interest. Of course if the bank does not have the hard currency on hand, it must borrow it from the fed at the current Fed Fund Rate which is by the way ZERO… Would you please recalculate the ROA or ROE based on these facts.
Let’s see, I can use someone else’s $10M in deposits and receive $4.7M revenue. Pay for my overhead (employees and facilites) about $1M. Pay myself $2.7M and contribute $1M to every Congressmen in my state and to both the Democrat and Republican parties. That should cover all my bases… I think I will start a bank…
At 20% reserve, the bank should be able to make a nice profit. Buying a house and putting 20% down would be the almost the same risk as lending from deposit at 20% if the housing market is stable. But if you don’t fix the deposit reserves to the same 20%, the bank will take the down and put it out on loan causing higher risk.
In some countries, the cash reserve ratios have decreased over time (sourced from IMF Financial Statistic Yearbook):
Country 1968 1978 1988 1998
Germany 19.0 19.3 17.2 11.9
Turkey 58.3 62.7 30.8 18.0
United Kingdom 20.5 15.9 5.0 3.1
United States 12.3 10.1 8.5 10.3
(Ratios are expressed in percentage points.)The recurring theme is banks tend to decrease reserves during highly speculative times to make the most money. The Government should increase the reserves during these highly speculative times. However, the problem is the government wants to also expand during these times. I’m not completely against fractional reserve banking, only the amount and the lack of control of the reserves.
Lucky In OC
(Corrected some previous errors – 2/19/09 7:29am)
Participant[quote=davelj]I mostly agree with Breeze and peterb. There’s nothing inherently wrong with fractional reserve banking and it has one enormous advantage over non-fractional reserve banking: lower interest rates. Look at the interest rate spreads between mortgages and government debt in countries where there is no or limited fractional reserve banking – they’re through the roof. Why? A thought experiment to explain part of the reason. Let’s say I want to start a bank and earn 10% on my equity. Fractional reserve banking allows me to lever up my equity, thereby lowering the necessary spread between my cost of borrowing (deposits) and lending (loans). Holding return on assets constant, my return on equity increases with leverage. So, let’s say I can lever 10-1, earn 1% on assets and achieve a 10% ROE. Now, let’s eliminate fractional reserve banking and now I have to fund entirely with equity. Now I have to earn a 10% ROA. If my cost of deposits is 3% and operating costs are 2%, then I have to charge 15% on my loans to make it worth my while. Anybody want 15% mortgages? Then eliminate fractional reserve lending and your wish shall be granted in short order.
Personally, I don’t have a problem with 20% down mortgages. Recall, that without the 0%, 5%, 10%, etc.-down mortgages, we never would have had the bubble in the first place, so the 20% down mortgages wouldn’t currently be in jeaopardy. That is, if we had stuck to 20% down over the last 8 years we wouldn’t be in this mess in the first place. [/quote]
Banks don’t loan money and the same rate the pay depositors… There is always a 3-6% margin. But the bank’s return is more than 10x the depositors return.
If the bank pays 3% to depositors and charges 5% for loans, at 10:1, the bank would get 50% for every 3% paid or 47% revenue on deposits. The problem in your 10:1 scenario is 9 dollars will get redeposited in the banking system and show up as additional deposits. Now, the bank can loan another 8 dollars on the 9 dollars deposited that the bank ‘created’ and so on. It becomes not just 10:1, but about 56:1 in money supply. So, the bank makes 280% and pays out 30% or 250% revenue on deposits. Based on this, Depositors should be getting returns above the percentage of the loans, not below.
A bank has $100M on deposit. At the end, of the year it will have $47M in revenue without using any of its own money. Now, what do you think the current reserve policy of banks is 10%, 5%, 3%???
Transactions is 10%. All other accounts (Savings, CD’s, etc.) 0.00000% … ZERO, NIL, NOTHING, NADA… This is money value not created by Congress.
This is the 2nd source of inflation and the devaluation of the dollar. Who pays for this inflation? We all pay for this inflation to the banks because everyone increases their prices to pay for this interest. Of course if the bank does not have the hard currency on hand, it must borrow it from the fed at the current Fed Fund Rate which is by the way ZERO… Would you please recalculate the ROA or ROE based on these facts.
Let’s see, I can use someone else’s $10M in deposits and receive $4.7M revenue. Pay for my overhead (employees and facilites) about $1M. Pay myself $2.7M and contribute $1M to every Congressmen in my state and to both the Democrat and Republican parties. That should cover all my bases… I think I will start a bank…
At 20% reserve, the bank should be able to make a nice profit. Buying a house and putting 20% down would be the almost the same risk as lending from deposit at 20% if the housing market is stable. But if you don’t fix the deposit reserves to the same 20%, the bank will take the down and put it out on loan causing higher risk.
In some countries, the cash reserve ratios have decreased over time (sourced from IMF Financial Statistic Yearbook):
Country 1968 1978 1988 1998
Germany 19.0 19.3 17.2 11.9
Turkey 58.3 62.7 30.8 18.0
United Kingdom 20.5 15.9 5.0 3.1
United States 12.3 10.1 8.5 10.3
(Ratios are expressed in percentage points.)The recurring theme is banks tend to decrease reserves during highly speculative times to make the most money. The Government should increase the reserves during these highly speculative times. However, the problem is the government wants to also expand during these times. I’m not completely against fractional reserve banking, only the amount and the lack of control of the reserves.
Lucky In OC
(Corrected some previous errors – 2/19/09 7:29am)
Participant[quote=davelj]I mostly agree with Breeze and peterb. There’s nothing inherently wrong with fractional reserve banking and it has one enormous advantage over non-fractional reserve banking: lower interest rates. Look at the interest rate spreads between mortgages and government debt in countries where there is no or limited fractional reserve banking – they’re through the roof. Why? A thought experiment to explain part of the reason. Let’s say I want to start a bank and earn 10% on my equity. Fractional reserve banking allows me to lever up my equity, thereby lowering the necessary spread between my cost of borrowing (deposits) and lending (loans). Holding return on assets constant, my return on equity increases with leverage. So, let’s say I can lever 10-1, earn 1% on assets and achieve a 10% ROE. Now, let’s eliminate fractional reserve banking and now I have to fund entirely with equity. Now I have to earn a 10% ROA. If my cost of deposits is 3% and operating costs are 2%, then I have to charge 15% on my loans to make it worth my while. Anybody want 15% mortgages? Then eliminate fractional reserve lending and your wish shall be granted in short order.
Personally, I don’t have a problem with 20% down mortgages. Recall, that without the 0%, 5%, 10%, etc.-down mortgages, we never would have had the bubble in the first place, so the 20% down mortgages wouldn’t currently be in jeaopardy. That is, if we had stuck to 20% down over the last 8 years we wouldn’t be in this mess in the first place. [/quote]
Banks don’t loan money and the same rate the pay depositors… There is always a 3-6% margin. But the bank’s return is more than 10x the depositors return.
If the bank pays 3% to depositors and charges 5% for loans, at 10:1, the bank would get 50% for every 3% paid or 47% revenue on deposits. The problem in your 10:1 scenario is 9 dollars will get redeposited in the banking system and show up as additional deposits. Now, the bank can loan another 8 dollars on the 9 dollars deposited that the bank ‘created’ and so on. It becomes not just 10:1, but about 56:1 in money supply. So, the bank makes 280% and pays out 30% or 250% revenue on deposits. Based on this, Depositors should be getting returns above the percentage of the loans, not below.
A bank has $100M on deposit. At the end, of the year it will have $47M in revenue without using any of its own money. Now, what do you think the current reserve policy of banks is 10%, 5%, 3%???
Transactions is 10%. All other accounts (Savings, CD’s, etc.) 0.00000% … ZERO, NIL, NOTHING, NADA… This is money value not created by Congress.
This is the 2nd source of inflation and the devaluation of the dollar. Who pays for this inflation? We all pay for this inflation to the banks because everyone increases their prices to pay for this interest. Of course if the bank does not have the hard currency on hand, it must borrow it from the fed at the current Fed Fund Rate which is by the way ZERO… Would you please recalculate the ROA or ROE based on these facts.
Let’s see, I can use someone else’s $10M in deposits and receive $4.7M revenue. Pay for my overhead (employees and facilites) about $1M. Pay myself $2.7M and contribute $1M to every Congressmen in my state and to both the Democrat and Republican parties. That should cover all my bases… I think I will start a bank…
At 20% reserve, the bank should be able to make a nice profit. Buying a house and putting 20% down would be the almost the same risk as lending from deposit at 20% if the housing market is stable. But if you don’t fix the deposit reserves to the same 20%, the bank will take the down and put it out on loan causing higher risk.
In some countries, the cash reserve ratios have decreased over time (sourced from IMF Financial Statistic Yearbook):
Country 1968 1978 1988 1998
Germany 19.0 19.3 17.2 11.9
Turkey 58.3 62.7 30.8 18.0
United Kingdom 20.5 15.9 5.0 3.1
United States 12.3 10.1 8.5 10.3
(Ratios are expressed in percentage points.)The recurring theme is banks tend to decrease reserves during highly speculative times to make the most money. The Government should increase the reserves during these highly speculative times. However, the problem is the government wants to also expand during these times. I’m not completely against fractional reserve banking, only the amount and the lack of control of the reserves.
Lucky In OC
(Corrected some previous errors – 2/19/09 7:29am)
Participant[quote=davelj]I mostly agree with Breeze and peterb. There’s nothing inherently wrong with fractional reserve banking and it has one enormous advantage over non-fractional reserve banking: lower interest rates. Look at the interest rate spreads between mortgages and government debt in countries where there is no or limited fractional reserve banking – they’re through the roof. Why? A thought experiment to explain part of the reason. Let’s say I want to start a bank and earn 10% on my equity. Fractional reserve banking allows me to lever up my equity, thereby lowering the necessary spread between my cost of borrowing (deposits) and lending (loans). Holding return on assets constant, my return on equity increases with leverage. So, let’s say I can lever 10-1, earn 1% on assets and achieve a 10% ROE. Now, let’s eliminate fractional reserve banking and now I have to fund entirely with equity. Now I have to earn a 10% ROA. If my cost of deposits is 3% and operating costs are 2%, then I have to charge 15% on my loans to make it worth my while. Anybody want 15% mortgages? Then eliminate fractional reserve lending and your wish shall be granted in short order.
Personally, I don’t have a problem with 20% down mortgages. Recall, that without the 0%, 5%, 10%, etc.-down mortgages, we never would have had the bubble in the first place, so the 20% down mortgages wouldn’t currently be in jeaopardy. That is, if we had stuck to 20% down over the last 8 years we wouldn’t be in this mess in the first place. [/quote]
Banks don’t loan money and the same rate the pay depositors… There is always a 3-6% margin. But the bank’s return is more than 10x the depositors return.
If the bank pays 3% to depositors and charges 5% for loans, at 10:1, the bank would get 50% for every 3% paid or 47% revenue on deposits. The problem in your 10:1 scenario is 9 dollars will get redeposited in the banking system and show up as additional deposits. Now, the bank can loan another 8 dollars on the 9 dollars deposited that the bank ‘created’ and so on. It becomes not just 10:1, but about 56:1 in money supply. So, the bank makes 280% and pays out 30% or 250% revenue on deposits. Based on this, Depositors should be getting returns above the percentage of the loans, not below.
A bank has $100M on deposit. At the end, of the year it will have $47M in revenue without using any of its own money. Now, what do you think the current reserve policy of banks is 10%, 5%, 3%???
Transactions is 10%. All other accounts (Savings, CD’s, etc.) 0.00000% … ZERO, NIL, NOTHING, NADA… This is money value not created by Congress.
This is the 2nd source of inflation and the devaluation of the dollar. Who pays for this inflation? We all pay for this inflation to the banks because everyone increases their prices to pay for this interest. Of course if the bank does not have the hard currency on hand, it must borrow it from the fed at the current Fed Fund Rate which is by the way ZERO… Would you please recalculate the ROA or ROE based on these facts.
Let’s see, I can use someone else’s $10M in deposits and receive $4.7M revenue. Pay for my overhead (employees and facilites) about $1M. Pay myself $2.7M and contribute $1M to every Congressmen in my state and to both the Democrat and Republican parties. That should cover all my bases… I think I will start a bank…
At 20% reserve, the bank should be able to make a nice profit. Buying a house and putting 20% down would be the almost the same risk as lending from deposit at 20% if the housing market is stable. But if you don’t fix the deposit reserves to the same 20%, the bank will take the down and put it out on loan causing higher risk.
In some countries, the cash reserve ratios have decreased over time (sourced from IMF Financial Statistic Yearbook):
Country 1968 1978 1988 1998
Germany 19.0 19.3 17.2 11.9
Turkey 58.3 62.7 30.8 18.0
United Kingdom 20.5 15.9 5.0 3.1
United States 12.3 10.1 8.5 10.3
(Ratios are expressed in percentage points.)The recurring theme is banks tend to decrease reserves during highly speculative times to make the most money. The Government should increase the reserves during these highly speculative times. However, the problem is the government wants to also expand during these times. I’m not completely against fractional reserve banking, only the amount and the lack of control of the reserves.
Lucky In OC
(Corrected some previous errors – 2/19/09 7:29am)
Participant[quote=davelj]I mostly agree with Breeze and peterb. There’s nothing inherently wrong with fractional reserve banking and it has one enormous advantage over non-fractional reserve banking: lower interest rates. Look at the interest rate spreads between mortgages and government debt in countries where there is no or limited fractional reserve banking – they’re through the roof. Why? A thought experiment to explain part of the reason. Let’s say I want to start a bank and earn 10% on my equity. Fractional reserve banking allows me to lever up my equity, thereby lowering the necessary spread between my cost of borrowing (deposits) and lending (loans). Holding return on assets constant, my return on equity increases with leverage. So, let’s say I can lever 10-1, earn 1% on assets and achieve a 10% ROE. Now, let’s eliminate fractional reserve banking and now I have to fund entirely with equity. Now I have to earn a 10% ROA. If my cost of deposits is 3% and operating costs are 2%, then I have to charge 15% on my loans to make it worth my while. Anybody want 15% mortgages? Then eliminate fractional reserve lending and your wish shall be granted in short order.
Personally, I don’t have a problem with 20% down mortgages. Recall, that without the 0%, 5%, 10%, etc.-down mortgages, we never would have had the bubble in the first place, so the 20% down mortgages wouldn’t currently be in jeaopardy. That is, if we had stuck to 20% down over the last 8 years we wouldn’t be in this mess in the first place. [/quote]
Banks don’t loan money and the same rate the pay depositors… There is always a 3-6% margin. But the bank’s return is more than 10x the depositors return.
If the bank pays 3% to depositors and charges 5% for loans, at 10:1, the bank would get 50% for every 3% paid or 47% revenue on deposits. The problem in your 10:1 scenario is 9 dollars will get redeposited in the banking system and show up as additional deposits. Now, the bank can loan another 8 dollars on the 9 dollars deposited that the bank ‘created’ and so on. It becomes not just 10:1, but about 56:1 in money supply. So, the bank makes 280% and pays out 30% or 250% revenue on deposits. Based on this, Depositors should be getting returns above the percentage of the loans, not below.
A bank has $100M on deposit. At the end, of the year it will have $47M in revenue without using any of its own money. Now, what do you think the current reserve policy of banks is 10%, 5%, 3%???
Transactions is 10%. All other accounts (Savings, CD’s, etc.) 0.00000% … ZERO, NIL, NOTHING, NADA… This is money value not created by Congress.
This is the 2nd source of inflation and the devaluation of the dollar. Who pays for this inflation? We all pay for this inflation to the banks because everyone increases their prices to pay for this interest. Of course if the bank does not have the hard currency on hand, it must borrow it from the fed at the current Fed Fund Rate which is by the way ZERO… Would you please recalculate the ROA or ROE based on these facts.
Let’s see, I can use someone else’s $10M in deposits and receive $4.7M revenue. Pay for my overhead (employees and facilites) about $1M. Pay myself $2.7M and contribute $1M to every Congressmen in my state and to both the Democrat and Republican parties. That should cover all my bases… I think I will start a bank…
At 20% reserve, the bank should be able to make a nice profit. Buying a house and putting 20% down would be the almost the same risk as lending from deposit at 20% if the housing market is stable. But if you don’t fix the deposit reserves to the same 20%, the bank will take the down and put it out on loan causing higher risk.
In some countries, the cash reserve ratios have decreased over time (sourced from IMF Financial Statistic Yearbook):
Country 1968 1978 1988 1998
Germany 19.0 19.3 17.2 11.9
Turkey 58.3 62.7 30.8 18.0
United Kingdom 20.5 15.9 5.0 3.1
United States 12.3 10.1 8.5 10.3
(Ratios are expressed in percentage points.)The recurring theme is banks tend to decrease reserves during highly speculative times to make the most money. The Government should increase the reserves during these highly speculative times. However, the problem is the government wants to also expand during these times. I’m not completely against fractional reserve banking, only the amount and the lack of control of the reserves.
Lucky In OC
(Corrected some previous errors – 2/19/09 7:29am)
ParticipantBreeze,
The problem does not lie whether or not the banks are public, private, or central. The real problem is when any financial institution ‘creates’ money based on limited fractional reserves. If you research the follow panics in the United States, you will find the following common thread is: Banks willing to lend fractional reserve money to highly speculative endeavors, be it land, railroads, dot.com, homes, gold, etc. The United States Government has not followed the Constitution that only “Congress has the Power: To coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures;”. It is the Government, we the people, that have given up that power to the banks. Gov’t has done it in the past in a smaller scale. And more recently, in a greater scale with the adoption of the Federal Reserve System. I think you will find that during these panics the government did not ‘regulate the Value’ of money. Rather, the Government allowed banks to increase the money supply by fractional reserves on highly speculative endeavors because the Gov’t reaped taxation benefits. Eventually, the speculation could not sustain itself, collapsed, and cause severe damage not only to the speculators, but the country as a whole.
Panic of 1819
Panic of 1837
Panic of 1857
Panic of 1873
Panic of 1893
Panic of 1901
Panic of 1907I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.
Thomas Jefferson, (Attributed)
3rd president of US (1743 – 1826)Lucky in OC
ParticipantBreeze,
The problem does not lie whether or not the banks are public, private, or central. The real problem is when any financial institution ‘creates’ money based on limited fractional reserves. If you research the follow panics in the United States, you will find the following common thread is: Banks willing to lend fractional reserve money to highly speculative endeavors, be it land, railroads, dot.com, homes, gold, etc. The United States Government has not followed the Constitution that only “Congress has the Power: To coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures;”. It is the Government, we the people, that have given up that power to the banks. Gov’t has done it in the past in a smaller scale. And more recently, in a greater scale with the adoption of the Federal Reserve System. I think you will find that during these panics the government did not ‘regulate the Value’ of money. Rather, the Government allowed banks to increase the money supply by fractional reserves on highly speculative endeavors because the Gov’t reaped taxation benefits. Eventually, the speculation could not sustain itself, collapsed, and cause severe damage not only to the speculators, but the country as a whole.
Panic of 1819
Panic of 1837
Panic of 1857
Panic of 1873
Panic of 1893
Panic of 1901
Panic of 1907I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.
Thomas Jefferson, (Attributed)
3rd president of US (1743 – 1826)Lucky in OC
ParticipantBreeze,
The problem does not lie whether or not the banks are public, private, or central. The real problem is when any financial institution ‘creates’ money based on limited fractional reserves. If you research the follow panics in the United States, you will find the following common thread is: Banks willing to lend fractional reserve money to highly speculative endeavors, be it land, railroads, dot.com, homes, gold, etc. The United States Government has not followed the Constitution that only “Congress has the Power: To coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures;”. It is the Government, we the people, that have given up that power to the banks. Gov’t has done it in the past in a smaller scale. And more recently, in a greater scale with the adoption of the Federal Reserve System. I think you will find that during these panics the government did not ‘regulate the Value’ of money. Rather, the Government allowed banks to increase the money supply by fractional reserves on highly speculative endeavors because the Gov’t reaped taxation benefits. Eventually, the speculation could not sustain itself, collapsed, and cause severe damage not only to the speculators, but the country as a whole.
Panic of 1819
Panic of 1837
Panic of 1857
Panic of 1873
Panic of 1893
Panic of 1901
Panic of 1907I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.
Thomas Jefferson, (Attributed)
3rd president of US (1743 – 1826)Lucky in OC
ParticipantBreeze,
The problem does not lie whether or not the banks are public, private, or central. The real problem is when any financial institution ‘creates’ money based on limited fractional reserves. If you research the follow panics in the United States, you will find the following common thread is: Banks willing to lend fractional reserve money to highly speculative endeavors, be it land, railroads, dot.com, homes, gold, etc. The United States Government has not followed the Constitution that only “Congress has the Power: To coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures;”. It is the Government, we the people, that have given up that power to the banks. Gov’t has done it in the past in a smaller scale. And more recently, in a greater scale with the adoption of the Federal Reserve System. I think you will find that during these panics the government did not ‘regulate the Value’ of money. Rather, the Government allowed banks to increase the money supply by fractional reserves on highly speculative endeavors because the Gov’t reaped taxation benefits. Eventually, the speculation could not sustain itself, collapsed, and cause severe damage not only to the speculators, but the country as a whole.
Panic of 1819
Panic of 1837
Panic of 1857
Panic of 1873
Panic of 1893
Panic of 1901
Panic of 1907I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.
Thomas Jefferson, (Attributed)
3rd president of US (1743 – 1826)Lucky in OC
ParticipantBreeze,
The problem does not lie whether or not the banks are public, private, or central. The real problem is when any financial institution ‘creates’ money based on limited fractional reserves. If you research the follow panics in the United States, you will find the following common thread is: Banks willing to lend fractional reserve money to highly speculative endeavors, be it land, railroads, dot.com, homes, gold, etc. The United States Government has not followed the Constitution that only “Congress has the Power: To coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures;”. It is the Government, we the people, that have given up that power to the banks. Gov’t has done it in the past in a smaller scale. And more recently, in a greater scale with the adoption of the Federal Reserve System. I think you will find that during these panics the government did not ‘regulate the Value’ of money. Rather, the Government allowed banks to increase the money supply by fractional reserves on highly speculative endeavors because the Gov’t reaped taxation benefits. Eventually, the speculation could not sustain itself, collapsed, and cause severe damage not only to the speculators, but the country as a whole.
Panic of 1819
Panic of 1837
Panic of 1857
Panic of 1873
Panic of 1893
Panic of 1901
Panic of 1907I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.
Thomas Jefferson, (Attributed)
3rd president of US (1743 – 1826)Lucky in OC
-
AuthorPosts