fractional reserve banking is actually good, and loaning money into existence is good too, and every time you do a friend a favor and say "pay me back later" you have created currency and that is excellent https://twitter.com/NinjaMa31969964/status/1188917420049735681 …
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3/ I assert a similar thing about people who can't wrap their heads around interest, fractional reserve banking, etc. The complaints are usually based on misunderstanding, or just NOT BEING ABLE to understand certain things. e.g. interest is not "payment for nothing" >
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4/ interest is an exchange of disimilar goods - trading apples for oranges. The apples are "dollars in year X", the oranges are "dollars in year Y". It would be quite odd if apples and oranges exchanged at exactly a 1:1 ratio; same with dollars in 2019 and 2025.
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5/ Goldbugs don't understand that "if people are willing to trade it then it is currency". YEAH BUT MARLICK, IT'S PAPER, NOT ACTUALLY REAL GOLD, SO YOU SEE- sigh so you've made up a theory that, like Marxism, is disproven by literally the entire world ok, great, you win
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6/ Fractional reserve banking antagonists get upset in exactly the way that "the constitution says that blacks are worth 3/5 of whites" people get upset - they exactly misunderstand what's going on. In the Const, it was an attempt to LIMIT slave states, not empower them.
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7/ Fractional reserve banking is likewise misunderstood - by requiring assets on hand, it is a huge LIMIT on loan generation. If I fix your flat tire and you give me an IOU for $100 and I trade that IOU to your neighbor for an old swing set, we've "created currency".
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8/ Why, exactly, is it bad that the currency "is debt"? I did some work up front - I fixed a tire. That is a productive good thing. It increased the amount of wealth in the universe. Now we're using that as a basis to move a piece of paper around, which creates liquidity.
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9/ what fractional reserve banking does is set LIMITS on how much of this natural behavior we can do.
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10/ a man of intellect and sophistication --> https://twitter.com/stephengracin/status/1188920316099284992 …
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