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Confusion about fractional reserve banking

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Preponomics - quote - Therefore even in a non-interventionist economy, will there be eventually a subtraction of property, and inflation, the moment any bank under performs, unless it is bailed out by selling its own assets, or getting into even more debt. This of course is not what banks in this situation have done historically. They will instead often print more fiduciary notes and steal the individual’s investment property unto unlimited printing, and cause societies money to be devalued. Non-intrinsic investments will be devalued without the individuals permission and goods to be purchased of intrinsic value will skyrocket with price inflation due to the increase of the money supply. This is indirect force using deception. It is to me a fine line somewhere between trickery, and fraud, and is absolutely in direct contradiction of honest principles.

I have one word incorrect in this paragraph

Non-intrinsic should be Intrinsic here is the proper paragraph below

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Preponomics - quote - Therefore even in a non-interventionist economy, will there be eventually a subtraction of property, and inflation, the moment any bank under performs, unless it is bailed out by selling its own assets, or getting into even more debt. This of course is not what banks in this situation have done historically. They will instead often print more fiduciary notes and steal the individual’s investment property unto unlimited printing, and cause societies money to be devalued. Intrinsic investments will be devalued without the individuals permission and goods to be purchased of intrinsic value will skyrocket with price inflation due to the increase of the money supply. This is indirect force using deception. It is to me a fine line somewhere between trickery, and fraud, and is absolutely in direct contradiction of honest principles.

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my apollogies

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ruveyn ben yosef – quoted – “Are you convinced that bankers will always become thieves. If so, what would you suggest that would keep the honest, short of have GORT visit the banker and reducing him to a burned out cinder.

No sir, I think there are and will be many honest bankers. However it is my deduction that history gives us a very familiar pattern of how the despot will consistently engage society. The despot is addicted to positions of control, and will gravitate to it the same way a fly is drawn to a light, as history has given us the despots demonstration unto uncountable innocent millions dead.

The despot is patient and seeks a position of power in any kind of institution that will afford him control. Government of course is the Holy Grail as the law can route all money, which is power unto his hands. However is not a bank also a haven for despotic activity in history? After all money is power and if one can control the money of others then they control the individual as well.

We hear little of the good bankers that have gone before who achieved honest profit, which is a shame, but upon death and destruction are more people mesmerized with a fascination.

This is my contention that if there are no economic interventionists, then a bank could do whatever they wish, however local society will become more prudent in time about the principles of individual economic independence, and the existence of a grifter of any kind that would pulverize it. I would predict and hope that local society to have proper laws locally to deal with theft, and fraud as they interpret lawful reaction upon trespass. To some will there be an arrest and to others an embrace, with wisdom separating the two.

In the confines of humor - If GORT shows up in my non-interventionist free market economy, I will dodge his weapon system, dismantle him, and spray paint “Hobbs is dead” on its forehead, or die trying.

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No sir, I think there are and will be many honest bankers.

How would you define an honest banker? Someone who makes money by charging people for safekeeping their gold, and that's it?

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No sir, I think there are and will be many honest bankers.

How would you define an honest banker? Someone who makes money by charging people for safekeeping their gold, and that's it?

Banker's also make loans so they gain income by charging interest (a kind of rent or fee for the use of the money they make possible).

ruveyn

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Preponomics – quote – “No sir, I think there are and will be many honest bankers.

Capitalism Forever – quote – “How would you define an honest banker? Someone who makes money by charging people for safekeeping their gold, and that's it?

I must say this judiciously in order that my meaning not be contrived accidently unto anything remotely contrary to honest prosperity, as I regard capitalism the life blood of individual economic independence, and banking a very necessary part of its operation. I am too, a proponent in common, that capitalism should be infinite through time as your screen name advocates. Upon it will be the sustainable wealth that leads to bliss with variance.

I believe in credit of all kinds that are “backed by one hundred percent gold reserves”. A bank may operate with all of the same advantages of capitalism as the individual, or any other business, which is to strategically invest money anyway they see fit, but unto honest standards void of deception. Is not credit used in a thousand ways unto profit?

One hundred percent backed gold reserves forces a bank to make money with the same honest rules of capitalism that the individual must also operate by to make a profit void of deceit. I am for banks making millions, billions, and would advocate, even trillions of dollars, but not one dollar or (hopefully in the future not one gram) by using a deceptive, or an unclear compulsory strategy against society to bind them to promised money. This only removes the individual’s property unaware, which also results unto wealth-stealing inflation, and even possibly gains an interventionist unto lawful economic despotism.

I also do think a bank could make great money also as a warehouse specialist providing security services of “trillions of incremental amounts” of gold bailment’s. Gold is highly divisible and to warehouse it would be a strategic service if were a standard.

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Ewv – quoted – “Honesty is not defined in terms of 'making money'.

The wisdom of your statement will hopefully permeate every recess of society, and even cause the socialist to ponder their foundation.

How is it, that the socialist can’t differentiate that which is rich from that which is dishonest? Two entirely different things, yet many, but not all, who cleave to fairness, blur the two unto a wicked resolve.

I could not agree more my friend

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I believe in credit of all kinds that are “backed by one hundred percent gold reserves”. A bank may operate with all of the same advantages of capitalism as the individual, or any other business, which is to strategically invest money anyway they see fit, but unto honest standards void of deception.

So you're saying that a banker may invest his own money, but not act as an intermediary for investing other people's money?

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No sir, I think there are and will be many honest bankers.

How would you define an honest banker? Someone who makes money by charging people for safekeeping their gold, and that's it?

In some types of bank, the bankers also invest the money of the customers who bank with them and with the permission of the customers. The permission may be implicit following from the fact that they are customers. The bankers also spilt the profits from the investment and interest collected with their customer. It is this split that is the inducement for the customers to bank with that banker.

ruveyn

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Preponomics – quote – “I believe in credit of all kinds that are “backed by one hundred percent gold reserves”. A bank may operate with all of the same advantages of capitalism as the individual, or any other business, which is to strategically invest money anyway they see fit, but unto honest standards void of deception.

Capitalism Forever – quote – “So you're saying that a banker may invest his own money, but not act as an intermediary for investing other people's money?

On the contrary “Capitalism Forever”, shall I bring more clarity to my position with further extrapolation, regarding contracts in a true non-interventionist market, where I differentiate contrast between a deceptive contract, one that is honest, and from one that is disallowed?

Disallowed Contracts is Interventionism
To say that a banker may not act as an intermediary for investing other people’s money” as you suggest would mean that society must require the interventionist to arbitrate contractual allowance, defining when or if it’s fair/good/safe for society to have one. I would suggest that such an interventionist in this position would upon maturity, construct a quagmire of legal plunders. So to give proper context, can we agree that such a person should not be in the picture, regarding the blissful market place of non-intervention we all hope for?

Honest Contracts in a Non-Interventionist Economy
Then unto banks, individuals, or any business for that matter, what should be a precedent for how a contract is written and exercised? I boast to say with clarity, and honesty should each person deal and exchange contractually. For if deceit or a convoluted scheme is used, then shall an immoral indirect force manifest upon those contractually trapped with its trickery. Thus honest contracts, absent of deceit, and then delivered clearly, is truly the best policy.

I also contend that if a bank, individual, or business of any kind were to lend money backed by one hundred percent of their own gold money, that this would be a very clear, very honest, and reputable loan. As the banker will simply put his/her own money at risk and avoid the unclear scrupulous backing of society’s property to be the risk, as the fiduciary paper propagates in circulation unto inflation. I would think that no-risk-banking is the best banking for the banker, but I contend that society will take a serious tumble unto poverty in the end, or be saved by a lawful despot.

Deceptive Contracts in a Non-Interventionist Economy
Now if a banker, an individual, or a business of any kind were to say to another, “We would like to invest your money as an intermediary unto much gain, are you interested contractually?” is not both parties free to make a contract? Unto losses, or gains will contracts go, but unto an honest start it should have. Yet if they offer up Fractional Reserve Banking, I contend it is not clearly exercised or understood most of the time, and matures unto theft for society. If the individual is contractually persuaded into giving away their property, not knowing the outcome, then I see this a poor choice by the individual, who may be unknowledgeable about such a deal, which causes them a certain risk unto loss. Then shall the banker with this unclear contract be the most certain deceptive winner as they transform a person’s property as their own (bailments), and then rob society’s property, with inflation when the system matures.

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ruveyn – quoted – “In some types of bank, the bankers also invest the money of the customers who bank with them and with the permission of the customers. The permission may be implicit following from the fact that they are customers. The bankers also spilt the profits from the investment and interest collected with their customer. It is this split that is the inducement for the customers to bank with that banker.

If the interventionist were not able to manipulate the economy, also where blissful Laissez Faire is exercised freely with all liberation, then will real world examples be exercised to certain measurable outcomes? Can we all agree that economic intervention serves as the thick fog; we all look through to assess the mechanical outcomes of economics in history?

I contend that in a world where banks and individuals were left alone at the local level, then banks would indeed get highly creative with the flow of real money, and become strategic for how more money can be made through the divisions of gold, with thousands of new contractual possibilities. However, I will imagine for the next several hundred years or longer, (providing free market economics can manifest) it will challenge society, to exercise these possibilities by trial, and error, to separate unto what is honestly successful from that which is deceptively compulsory.

I foresee that new strategies more complex than Fractional Reserve Banking will be implemented, and will mature before society understands the repercussions. However with each generation shall people become wiser, or that is at least our hope.

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