Bank credit is cash because of deposit insurance

Deposit insurance enables banks to increase the money supply.

We are forced to value bank credit if we value cash

If people learn how banking works they might take a different view with regard to the value of fiat money and bank deposits... but that doesn’t mean banks print money now. Unless the government prints money which they do not. Fiat money is impossible because the government is not powerful enough to alter prices.

Someone who mines fool’s gold is not mining gold. We can be fairly sure people do not value bank credit for its own sake so in that sense it is a trick.

The government have an obligation to prevent bank inflation.

Why the nature of fractional reserve banking is difficult to convince people of

Ham. Let me see. [Takes the skull.] Alas, poor Yorick! I knew him, Horatio; a fellow of infinite jest, of most excellent fancy. He hath borne me on his back a thousand times. And now how abhorred in my imagination it is! My gorge rises at it. Here hung those lips that I have kiss’d I know not how oft. Where be your gibes now, your gambols, your songs, your flashes of merriment, that were wont to set the table on a roar? Not one now, to mock your own grinning? Quite chopfallen? Now get you to my lady’s chamber, and tell her, let her paint an inch thick, to this favour she must come. Make her laugh at that. Prithee, Horatio, tell me one thing.

Some things are difficult to understand ...like death. Death is difficult to understand because our only reference is life. We look at death in the context of life which obscures it.

Fractional reserve banking is not possible without fiat money... which in turn is not possible without taxation. So we see fractional reserve banking in the context of coercion and government. It is this context which conceals banking like the head of a screw obscured by a higher surface.

Fractional reserve banking is an error within an error.

Image of Hamlet with the skull of Yorick.

We should monetise the deposits and let banks fail

If a banking collapse is intolerable (if banks are too big to fail) then we must monetise the deposits (and subsequently have free banking) otherwise the problem will continue... which leads to inflationary communism. If we do not monetise the deposits (and then let banks fail) we either suffer a traditional banking collapse or communism.

The solution to the banking crisis (if we cannot have an outright collapse) is to monetise the deposits and then let banks fail.

Deposit insurance is inflationary in a fiat economy

Deposit insurance is inflationary in a fiat economy where force makes value. It’s not good (for everyone else) if the government will accept worthless bank credit... if money is fiat. Given we accept fiat then banks should not be able to print money... If fiat currencies are fair then deposit insurance is unfair.

If deposit insurance is fair then governments (and fiat currencies) are unfair.

Inflation is caused by deposit insurance

We should get rid of deposit insurance and allow banks to fail.

Bad politicians are caused by first past the post

People who hate proportional representation hate freedom and capitalism... pr is freedom relative to fptp. Nothing is worse than unequal fptp.

Governments who refuse to allow pr are not confident of their popularity.

Proportional representation is more democratic (not that anyone advocating fptp would care)

If there is no assumption to contradict we are left with ostracism.

Proportional representation is better at making sure criminals get locked up

We can think about government in more than one way. We can see it as a master of everyone ...an entity which issues orders and threats. Or we can see it more like a jury in a court of law. In the case of a jury we get to choose whether the accused is guilty (and should be excluded from society) or innocent. In the same way when we vote we choose whom to exclude and whom to forgive.

The problem with first past the post is that it does not give us very much precision in this process. Other systems of voting make it easier to be specific about what we want and what we do not want. We can be more specific about whom we want to be represented by. This offers us the opportunity to include (or exclude) people who would otherwise be excluded (included) by the main parties.

Proportional representation is better at making sure criminals (as viewed by the electorate) are punished. First past the post enables criminals to go unprosecuted.

Banks print money because of first past the post

Bank credit is money because people (can only) vote for deposit insurance.

The two facts which prove that banks print money

To understand that banks print money two things need to be shown: Firstly that money is nothing more than state credit. Secondly that bank credit is state credit.

i) Money is nothing more than state credit... Cash has value only because it is accepted by the state. We now have a fiat money which is not backed by any commodity. Since there is no commodity it is unambiguous that the value is derived from the recognition of the state. The value comes from nowhere else.

ii) Bank credit is state credit... Bank credit is guaranteed by the state which prevents bank runs. Credit which is guaranteed by the state is state credit because there is no more reliable credit than state credit.

Banks are not private firms... deposit insurance means they are owned by the state

Bank liabilities are state liabilities because of deposit insurance. Banks print money because state liabilities are money and bank liabilities are state liabilities.

The government has a responsibility to educate people about fractional reserve banking

Fractional reserve banking is a government conspiracy (even if they don't know about it)

The government has a responsibility to be open and honest to its subjects. Most people do not realise that banks print money and so the government has failed in its responsibility. It is not the responsibility of the people to find this out since it is not a private sector fraud.

The government has a responsibility to educate people in the matter of fractional reserve banking.

Constitution: Banks aren’t allowed to print money

Bank credit is valuable because of taxation... it is a form of fiat money

Fiat money derives its value from taxation. In effect it is a tax receipt. Not only government but banks can print tax receipts... they are exempt from taxation. They can also sell tax receipts to customers.

Fractional reserve banking is like quantitative easing (legal) not counterfeiting.

Fractional reserve banking is a waste of time

The government is ignorant of how banking works otherwise it (fractional reserve banking) would be illegal. Either that or the government is content for the banks to print money.

The government is not aware that (is in denial of the truth that) banks print money.

There are no crimes

Nothing is true everything is permitted.

Everyone (else) is insane and there are no crimes committed by others... no one is arrogant.

It’s not a problem that banks can print money

It may seem offensive that banks can print money but they are victims of life just as we all are.

There is no winning argument to be made against the (inflationary) banking system. They hold no false beliefs or assumptions. Inflation is not a violation of property rights only government copyright.

There really are no true scotsmen (it's not a fallacy)

Because there are no groups... see Russell's paradox.

Better language: Deposit protection is a better term than deposit insurance

Deposit protection is more suggestive of the hierarchy which must exist for deposits to be protected by the state. Deposit insurance sounds more like a free market arrangement. It is possible to have insurance without a hierarchy. By necessity to have protection (on the other hand) one must be stronger than the other which is a hierarchy.

Deposit protection is a better term.

Definition of arrogance: Someone who rejects (fails to accept) a valid contradiction to their claim

The opposite of arrogant is humble. The opposite of insane is normal or sensible (mainstream).

Bank runs are healthy to prevent inflation of the money supply

Banks runs are good but they are prevented by deposit insurance.

If fractional reserve banking is possible it is important for the economy to have a bank run which makes sure money retains its value and there is not too much inflation.

Fractional reserve banking is fraudulent...

We can have an economy of gold into which seeps a supply of pyrite. This is very good for the person who issues the fool’s gold because they get extra value for nothing. No one notices the difference which is why the pyrite trades at parity with the real gold.

Eventually there is so much fool’s gold (pyrite) that it causes significant price inflation... this process is sustainable even when the real gold is only a fraction of the overall money supply. Still people will not notice.

Fractional reserve banking would not exist in a free market

Fractional reserve banking is fraud in a free market

In a free market fractional reserve banking is always a fraud. We are diluting our cash deposits with other people’s credit... which we might not get back. We are exchanging cash for a part share in cash so (unless the customer is ignorant of the relationship) there would be no fractional reserve banking in a free market which is not a fraud.

Definition of insanity: Someone who is in denial of (cannot accept or see) an obvious truth

The opposite of arrogant is humble. The opposite of insane is normal or sensible (mainstream).

Banks shouldn’t be allowed (by the government) to make loans if they have deposit insurance

Fractional reserve banking guaranteed by the state is a crime

The state should not have given permission for the banks to increase the money supply. It’s fine unless there is a guarantee.

In a free market everything is permissible... even fraudulent banking. However once a state guarantee has been introduced banks have an obligation to not make loans otherwise inflation results. Paradoxically the licencing of fractional reserve banking by the state actually makes it impossible.

Fractional reserve banking is insolvent banking

Deposit insurance is caused by fractional reserve banking unless a crash is tolerable

If either a crash is tolerable (a crash is not bad) or if there is no fractional reserve banking then there is no reason for deposit insurance. Deposit insurance is to prevent a crash as a result of fractional reserve banking. Fractional reserve banking creates a crash unless there is deposit insurance.

If a crash is bad and fractional reserve banking exists then there will be deposit insurance.

It is the fault of fractional reserve banking that we have deposit insurance. Banks can’t fail because of fractional reserve banking.

We don’t know the true reason for the value of bank credit

If deposit insurance is irrelevant to the value of bank credit then banks print money due to their own good luck. If deposit insurance prevents a banking collapse then banks print money because of the state.

Bank credit is money for reasons other than deposit insurance

The existence of deposit insurance is only evidence that bank credit is money... not the reason. Bank credit is money not because of deposit insurance but because of its widespread use as a medium of exchange. It is money for reasons other than deposit insurance even though removal of the insurance would result in a collapse.

If there is a social contract then banks print money

There is no reason for first past the post

There is no reason to restrict the number of successful candidates to one only.

Fractional reserve banking: There is no argument to be made against begging

Fractional reserve banking with deposit insurance is counterfeiting... not that there is anything wrong with that.

The main parties are not open to proportionalists

There is no contradiction (of an assumption) to be made in the argument (against fptp) because no one assumes big parties should have an advantage. Remarkable as it may seem the big parties even see themselves as victims in many cases.

The government do not care about good government otherwise they would implement pr. Fptp creates dysfunctional politics because it makes the resource of power artificially scarce.

More democracy means less government

Proportional representation is terrifying for politicians because they are scared of choice.

There is nothing wrong with deposit insurance

There are no national currencies all currencies (and governments) are private.

Proportional representation doesn’t make sense because government is not about choice

Proportional representation doesn’t make sense because if you wanted to give people a choice you would not have government. Government is the antithesis of choice and so it doesn’t make sense (for them) to have proportional representation.

First past the post governments don't care about democracy and are socialist

Proportional representation is basically no government at all. First past the post is government.

A bank is something that cannot fail

Without deposit insurance many banks would be insolvent.

There is no reason to have first past the post

Only anarchists who think the government is more liberal than voters hate proportional representation

Only people who hate democracy itself hate proportional representation but first past the post is stable because...

It only makes sense to complain about something if it contradicts the agent being good. And if you are on an even level of power and can walk away. It makes no sense to complain about pr and first past the post because the government (being powerful and bad) will not listen to an argument assuming its own tyranny by definition.

The land value ceiling: an explanation of how it works

The land value ceiling is a limit imposed by the government on personal land ownership. Under this rule no individual is able to own an amount of land in excess of the land value ceiling. Anyone violating this rule by owning an excess of land will be asked to either give it away or to sell the land. If they do not do so measures will be taken to bring them into line including the possibility of the land being confiscated.

It is a quantity of land measured in market value not the physical area of the land.

Credit is money if it is guaranteed by the state

Deposit insurance is nothing more than a subsidy for the banks.

There is nothing wrong with a deposit insurance limit

The only problem with the banking sector (now that the original error of deposit insurance has been committed) is the lack of a deposit insurance limit...

A deposit insurance limit would apply to the bank (not the customers) and it would limit the extent of the deposit guarantee for each bank and the banking sector as a whole.

There is nothing wrong with a land value ceiling

The concept of a land value ceiling is not objectively offensive.

There is nothing wrong with prop. representation

First past the post is for people who think the main two parties are libertarian

People who reject proportional representation either hate libertarians (are socialist) or consider the dominant two fptp parties to be libertarian. Libertarians who like fptp think the main two parties are libertarian.

Reform of the banking system would be a good idea

Constitutions are redundant but it would be a good idea to make bank inflation of the money supply illegal. Democracy is our only recourse to remove the right of banks to cause inflation.

Bank credit is money because people trust the government to print cash

Banks can print money if people trust the government guarantee. The general public do not have a preference for cash over government credit. People don’t mind if money isn’t cash.