If legal tender is valued for its own sake and not because of taxation then deposit insurance will have no bearing on inflation. It is because the government taxes the population that cash has monetary value. Inflation caused by deposit insurance proves the government is coercive. If the government is not coercive (cash is valued for a reason other than tax) deposit insurance would not alter the price of cash... cash would remain exclusive.
It is because people do not value cash for its own sake but because of tax that deposit insurance causes inflation.
The inflationary nature of deposit insurance proves that government is coercive.
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