Agreed. Relevance ?
I wouldn’t do that. I don’t see how that’s relevant, though.
Relevance ? The case we are discussing is : there are more liabilities than assets.
If the insurance company SAYS it can pay off the unlikely scenario in x days, BUT in reality it would take them 10x days to get the money ready then they are committing fraud. If the unlikely scenario doesn’t happen then their fraud won’t be discovered. It is still fraud though.
I don’t think that’s what I said.
No you don’t because you said that the risk involved in any business is a form of gambling. It’s not, and if you know (and agree) with the difference, they you wouldn’t say such an incorrect statement.
Because there is always a party that must be defrauded (violation of contract) for the “procedure” to work. That is all. We contract on an exchange of a car for a horse but you give me an apple instead. That is fraud.
A demand deposit never contains the clauses for deferral of payments or whatever that you claim should exist. That’s why it is fraud. If it did, then there would be no problem, but then we are no longer talking about demand deposits and FRB (I don’t know how many times I can make this point).
All 100% reserve advocates have no problem with your scheme where everybody agrees (including any 3rd party like the one buying this ticket on the market) but simply contend that it is no longer Fractional Reserve Banking. The “free bankers” insistence that these tickets can circulate as money substitutes as in the present system of fiduciary media is where their reluctance to drop the current idea of FRB is exposed.
I’ve already answered this - using the Princeton definition it is. Again, please, no more about this unrelated diversion.
Stick to the question presented, your replies are non-sequitars. I don’t have any intention to discuss other reasons why it is fraud, only the one: it is fraud because “its possible that the bank cannot pay on demand” not that its a ponzi-scheme, that it definitely will fail, its inherently inflationary, or any other objection. Those are all different objections, perhaps valid, but don’t pertain to the question. And please save your rants about “free banking” for another thread.
Princeton? A dictionary is going to tell you that “risks” of business ventures are equivelant to gambling?
And it is relevant because you made the comparison to insurance in particular, and not just any business. You implied a similarity in the “procedure” or business structure between the two.
The non-sequitar replies are yours. It is fraud because they cannot meet their contractual agreement. Emphasis on contractual agreement. The clauses you always allude to do not exist in practice.
That is just the outcome of the nature of FRB. It is the consequence of the fraudulent practice, not the cause of it! You are misrepresenting the argument for fraud.
Inflation (as defined by increase in money supply) is not necessarily fraud unless:
The depositor is defrauded into a demand deposit contract when in fact the deposit is lent out without the consent of the depositor
A 3rd party is defrauded by thinking the claim tickets are 100% backed by gold when in fact they are not, and as a result buys them as if they were.
Insurance is a product of the market, yes. When I said free market, I meant a stateless society.
If anything.
No, I explicitly stated a similarity in possible outcome! I’ve made it absolutely clear that procedures are irrelevant.
In the event of an unexpected disaster, life Insurance agencies cannot possibly meet their contractual agreements. So they are different how?
I’ve asked you very nicely to stick to the question presented, and you seem to go out of your way to attack different ones. Now, even going as far as replying to objections I specifically mentioned as being examples of off-topic.
Please, pretty please, stick to the question presented: A possible outcome of FRB being the reason its fraud. Any other reason is irrelevant at this time. Thank you.
Would Rothbardian’s ban individuals from voluntary engaging in a FRB transaction/agreement? If no, which is the expected answer, then this whole debate is fruitless. People will choose to put their savings in a bank which pays a good amount of interest (as opposed to paying a store house–which would probably be engaging in FRB anyways).
Any responses that you don’t like are labeled as off topic by you. Here: FRB is like insurance. It is not fraud. I’m sure this what you consider a relevant response to the question.
This is not true. There is never any such thing as a contractual agreement that guarantees a successful investment outcome. No such contractual agreement ever takes place, not with insurance or with any other business. And this is certainly not the case being made for FRB fraud; you are attacking a straw man.
FRB violates the contractual agreement because the terms of exchange are being violated or impossible to be carried out from the start. There are no explicit options for deferral of payments or anything. Money is being guaranteed by contract as if the money is safely stored in a warehouse. There are according to the contract, multiple owners with simultaneous right to use and claim. They are not merely “players” in some “risk” scheme, but owners as defined by the contract with NO without any such option clause like you invented before . Not the outcome of the business investments are guaranteed; they never are, but the terms of use cannot be carried out from the start.
It is more complicated then how you present it. I think it would be argued that contracts should be enforced and FRB contracts as historically and currently are practiced are fraudulent. They would expect an arbiter agency to recognize either
the contract is being outright violated, i.e., the depositor was deceived, defrauded or whatever…
The contract itself poses an impossible or nonsensical condition, i.e., two parties cannot claim separate ownership to the same property. They can be co-owners but not separate owners. Two people cannot consume the same whole banana. Why is this important? Because unlike the banana, in cases such as demand deposits, such a contract effectively creates money out of thin air and allows 2 people (and more) to actually eat the same banana. The public becomes a 3rd party victim of the fraud no less then the fraud committed by counterfeiting. The public never agrees to this. If it did (hypothetically), then no fraud would take place.
No, you could say they both are fraud, or you could show how the insurance company actually does have enough.
The argument has been raised multiple times on this site. If you disagree with the terms, great.
You are attacking the current monetary nightmare, while I disagree on many points, its not an argument against FRB itself, just the current system. Likewise it does nothing to reveal how FRB itself is fraudulent… in any way.
He said the practice should be punished as fraud.
yes, because Rothbard was concerned that the bankers would call the accounts that they offer ‘demand deposits’ when they should call them ‘callable loan-to-bank accounts’
The practice is inherently fraudulent simply due to the name? I don’t think that fits with Rothbard’s excellent title-transfer theory.
I think in most cases, you probably misunderstood the argument or if such as case has been made by someone, then it is obviously false.
This current system is how the system has always operated whether there was more government intervention or less. This is how contracts have always been defined. Deception has always been the driving force behind FRB. You should familiarize yourself better with what you call the “Rothbardian” position. It is the only way in which FRB can work. The illusion of demand deposits must always be present, but there is no way to preserve “demand deposit” contracts without this deception. If you add your clauses, then the deposit is no longer a demand deposit. The system is no longer FRB, as I explained many times before. The free bankers are trying to have the cake and eat it at the same time.
You should become more familiar with the fraudulent argument before trying to discredit it. You have either learned about it only from White and Selgin or the crowd that learned about it from White of Selgin. They misrepresent the entire argument. They avoid addressing the full criticism about the logical contradictions and the economic unsoundness of the system. They will talk to you about demand to hold but no present to you the devastating criticism this has received in relation to FRB.
Go read de Soto’s latest book. It has the most up to date criticism of the free banking school. Both legally and economically. Then come back and debate it.
As per Rothbards Title-Transfer theory:-
for the sale of bread for money to not be implicit theft vis a buyer who wants to buy bread, the bread should be bread and not merely something that the seller called ‘bread’ for which the name ‘bread’ is inappropriate to communicate to the buyer who wants bread that the ‘bread’ is not bread
To advocate against this theory is not to advocate for anarchy but to advocate for chaos.
And everyone know what a demand deposit is, so your point is?
support this with evidence please.
p.s. the real challenge for you is to demonstrate how people could avoid confusion between ‘demand deposits’ which are warehouse bailment contracts and ‘demand deposits’ which are callable loans to banks, given that under ‘freedom’ both would be marketable and might expect some custom. it seems obvious to me, if not to you, that the difference between the two type of accounts is so huge that to dodge the question of how to label them distinctly so they will not be confused in the market place would be a real issue, and not something to shirk as you and others do so flippantly. your shirking will be taken as the ‘bread maker’ who sells ‘plastic loaves’ implicit theft stance it is.
These are nonexistent or called safety deposit boxes.
Fair enough.
Be that as it may, that has nothing to do with the nature of FRB itself. It may certainly be possible that it wouldn’t arise, this has nothing to do with the theory itself, which is all I’m interested in at the moment.
I’ve read quite a bit from both sides actually, I’m no expert but I think I have a fair understanding of them. I don’t agree fully with White and Selgin (particularly about Scotland) at the same time, de Soto made some almost embarrassing mistakes in the fraud department. There isn’t a logical contradiction in FRB itself, even some full-reservists have admitted that much.