Topic: Fractional Reserve Banking and the creation of the Debtcoin - page 5. (Read 5493 times)

And just in case you won't believe Hoppe, here's a mainstream historian:

The Modern State, Routledge, second edition 2004, page 27

But not de facto wrong. Groups had effective monopolies on force before machiavelli, he just merely observed the phenomenon and explained it, he didn't invent monopolies on force, is all i'm saying. I haven't read the link yet.

You could say that, but you would be wrong.

https://mises.org/document/1092/Myth-of-National-Defense-The-Essays-on-the-Theory-and-History-of-Security-Production

Sorry, see my post #25 for my reply to these questions. I would say it is older than Machiavelli. Also i want to point out that there are other markets with their potential monopolies other than money creation that are powerful enough to influence "government", them being energy, food supply, water supply. They are the other rhinosceroses (sp?). You might could say government is a collection of all these including armed force. It can't ever be totally free due to animal social structure. I'm not a sociologist or a biologist, just my opinion.

You do understand that the concept of a monopoly on force is only as old as Machiavelli?

Market law and rights protection would do a hell of a lot better job than a monopoly.

By influencing the government? What government?

I don't think so, if it ultimately means oppressing everybody.


The same way it does now

But if you could magically create a situation with no government like through armageddon or something, then a new "government" would arise and it would entity forcing a the security equilibrium achieved after at least a little bit of "squabbling".

The ones simply with the ability to put a stop to the squabbling is the "government". They would basically have a monopoly on the use of force. You would not have anything less than this, due to nature of human/animal hierarchical social structures.

This "government" entity is the kernel of the thing that would ultimately get hijacked by a money monopoly, unless it itself is a money monopoly, if there even is a money monopoly

So, the successful banks should not be rewarded for their wise policies in not putting out too many notes?

Yes, but you postulated a free market system.

Tell me, how exactly would a huge bank harm the public?

The customer base. The surviving bank will acquire all the failed bank's customers. The customers aren't going anywhere. They're still going to need somewhere to put their gold, btc, grain, whatever the reserves are.



But in reality right now, there is a government.

But let's just say there isn't one.

Currently the government is this: It is a giant bedsheet with obama's mug painted on it covering a bunch of rhinoseruses that are a little too close to joe shmoe. The harm that these animals can do without a government is about the same as it is now, but without the bedsheet draped over them.

One question:

What would motivate a large bank to buy the debt of a smaller one? They might buy up the assets (brick and mortar buildings, etc), and certainly that might be used to pay back the remaining outstanding debts, but the out of business bank will not be "merged," it will sell off whatever it can, and then fade into history.

And let's assume that that's exactly what happens: All the other banks suffer runs because they were stupid, and their assets are picked up by one big bank - or a cartel - that does a lot of business. Without the government to influence, what harm can they do?

I agree.  But I believe that its worth trying to regulate businesses in order to control the social costs of stupid failures.  Its why I am a statist.  Private enterprise is an engine of wealth and as such we all love it.  But wealth is not the only goal of society.  Things like fairness and justice matter as well.

If we can think of a way to distribute the proceeds and risks of FRB equitably, instead of letting it be private profit and dog eat dog for would be oligarchs and plutocrats, maybe it would turn out differently.

I'm risking being chastised by myrkul because im going to dis on a free market, but i don't know how else to explain this.

I'm not talking about joe shmoe borrowing past their credit limit or even a government borrowing past its credit limit, although this debt slavery is fairly inevitible with free market FRB run amock through its full cycle.

I'm saying if you have a free market providing FRB services, which produces usable money in the form of notes and accounting entries on reserves, the vendors in this market who happen to be idiots or unlucky or victims will issue too many notes and suffer panics on reserves and therefore become absorbed or merged or bought by another FRB.

This process happens over and over and over and over until there are only a very few big players with all the reserves all pooled up in just a few places. They then cartelize. When a cartel in something as important as creating the money supply gets big enough, it starts influencing the government.

We've run the whole gamut with this already from Andrew Jackson days to 1913 when the cartel was made the official true monopoly in the form of the FED, continuing until now, where the government is pretty much a total tool of this cartel.

It happened in Europe in pretty much every country. It happened in the US. You can't deny it. It cannot not happen again if we start all over again with the same system.

So much fallacy...

A so-called base-inflationary publicly owned and operated monetary token system is an absolute and critical necessity to all and any economic growth. It also provides the new excess liquidity (in accompaniment to exportable workforce productivity) necessary to loan it to new enterprises or to finance public projects without taxation. Then private lenders may also participate through their invested savings as well.

A privately owned for private profit inflationary, private monetary token debt-enslavement system requires regressive boardroom-socialist public taxation to pay off the enslaving lenders, and enslaves all new entrepreneurs and the state as well, to the fiat dictates of the secret insider trading monopolist boardroom-socialist (FED) high-preisthood tyrants who own, operate and monopolize all. Other private lenders cannot participate in lending because their costs of lending cannot compete with the monopoly counterfeiters.

A deflationary currency (like limited gold, platinum, palladium or antiques, fine arts or other rarity "Medium of Savings") when stupidly abused as a Medium of work-Resource Exchange "currency" that constantly becomes ever-rarer and ever-more valuable with any and all growth is a totalitarian Austrian fascist recipe for and sentence to eternal abject bonded debt enslavement to elite "winning" monopolist gold-pharaohs, ad infinatum.

Step back from ideology a second. 

Is going to work fun compared to lying in bed watching TV?  For the vast majority, no. 

What's the rational thing to do? Lie in bed and idle as long as possible. 

What's to stop you idling forever?  Your credit limit. 

No social system will change the fact that most jobs suck.  Therefore, no social system will change the need for credit.

Think about why they do that. Does the base inflationary system encourage savings, or borrowing? Would a base deflationary system encourage savings, or borrowing?

Lots of people borrow to their credit limit and rely on the repo man to provide them with motivation.  You could even argue that some countries like to borrow right up to their credit limits and then only start to work.  That's the way capitalism works - no amount of math will change that.  I appreciate that you'd like people not to behave that way but its the way things are.

I guess there isn't a problem if we don't mind going through the entire local-bank-panic-so-merge-with-another-bank-over-and-over-again-until-it-becomes-a-behemoth-cartel-composed-of-very-few-members-that-hijacks-the-government-and-turns-everybody-into-debt-slaves cycle all over again

Higher usury-interest coupled with reserve (once gold-receipt) counterfeiting are actually the number one causes of inflation (devaluation or demeaning) of the Medium of Work-Resource Exchange "currency" (money). By this I mean undue profiteering (excess inflation) in excess of the goodly need of an economy and it's "currency" to "grow properly" (inflate properly and naturally in a well-regulated manner) based upon the ever-increasing (enlarging)  exportable value growths of the increasing values of all of the fruits of all it's also-growing workers (EP Export-Product) labours.

The reason the crime of interest usury originated was so that fraudulent gold-smiths could lend out counterfeited gold-reserve receipts, (first coin-tokens then paper receipt-notes) to people who had no gold deposited with them. They knew people didn't want the bother of the damned stuff and would never come back to claim any unless they were moving away, so figured why not rent out phoney ones as well as good ones? Their unfairly criminal (and costless) competition in the lending business inflated rates of usury, since real lenders could not accept risks reserve-counterfeithers could, and consolidating counterfeiters ended up repossessing everything..

The security of the Bitchain system makes this fraud impossible with a Bitcoin Funded Credit Swap OTC derivative-coin. Smiths cannot duplicate Bitcoin OTC derivatives to lend them out in a "reserve loan-counterfeiting" fashion. (unless idiot morons are allowed to mint or ever stupidly agree to accept physical Bitcoins that cannot be "confirmed") The Tory "Federal Reserve Printing Company" or "WB-IMF" Trotskyite reserve-counterfeithers could, however, "intervene" (price-fix or crash) the Bitcoin "penny stock" market, but if we always out-maneuver them to price the BTC at a mid-point between USD and Euro they would always lose and we all should always profit.

The fact that BTC are traded on hundreds of discreet markets also foils them, although dangerous preeminence of the vulnerable Mt Gox monopoly is a serious global-threat to our currencies safety.

In 48 BC the Pontifex Maximus, Julius Caesar outlawed private coin-smithing/usury and minted the first publicly owned for public profit public coin-currency, which could only be rented from the Republic. With it's profits domestic taxation became obsolete, and he was able to complete vast expensive public projects. As with Lincoln and JFK, this was why he was assassinated.