Actually, I think you can pay your bills and mortgage with cash.
And if getting something for nothing isn’t implicit - i.e. earning money on your savings account or having quick access to checks without having to pay hundreds a year - I don’t know what possibly could be.
Poor security guards?
Only if you like strawmen.
Woha woha woha…Rothbard has a statue? [^o)]
you think of the government as security guards?
Demonstrably false.
In a nation where getting something for “nothing” (i.e. stolen by the government) seems normal, is it any shock that the general public would think it isn’t implicit? The point is that the ignorance level of the public is enough that it’s not clear whether it’s implicit. Decieving someone who is missing information, someone ignorant of what’s going on, is still a deception, right? But honestly I’m not sure whether this question is so important when there’s the glaring question of whether the FRB system is honest to begin with.
So is that it? I was hoping you’d at least address the question I thought you should be asking:
I think you’re asking the wrong question. Why not ask, is fractional reserve banking honest? And if it is, why do banks need to rely on government (to guarantee deposits) taking money from taxpayers, who as a whole have nothing to do with the agreement between an individual and a bank? Is it moral to force the general public to accept this risk? How could this be anything but banks using the government to pass on the risk of their dishonest banking onto the innocent public?
If the general public understood what was going on behind the scenes in our fractional reserve system, they’d be rioting in the streets. Just because it’s a stealth system and most people don’t understand that they’re being robbed blind (and so continue to participate in the system), that doesn’t mean it’s honest.
(I’m assuming “it” is full reserve banking? If not sorry for not reading the entire thread…)
There’s no demand for it because the government(“men with guns”) FDIC interference in the system eliminates the risk of loaning out your money? At least from the saver’s perspective.
Were it not for FDIC insurance, most people would have cash at home under the mattress, because they just want it stored without risk of it vanishing. Although if you take it a step further, were it not for FDIC insurance, I think we’d eventually have full reserve “warehousing” accounts. Have you read anything by Rothbard on this subject? Reading a short book or two by him on the subject should clear up most of these simple questions.
Then why do people invest in the Caribbean off-shore accounts where there is no federal insurance?
Tax haven. Any more easy questions? Deposit insurance is only for $200k, anyways.
Its important to note that FDIC exists not to make people’s money actually safe, but to make people think their money is safe.
Please proceed!
Yeah, it’s a tax haven, but if there was no deposit insurance then certainly the banks would go wild and lose all the money, right? Just because it’s a tax haven doesn’t change the nature of the banks on it.
Huh? Insurance increases the chance that banks will go wild and lose all the money.
Well going wild = engaging in FRB in the first place. [:)] The insurance is only for the depositors against the risk of bank failure, it doesn’t really allow banks to engage in riskier behavior (other than preventing panics), and it certainly doesn’t prevent banks from going wild, either. What the banks gain from the insurance is the trust of the depositors–preventing bank runs and panics in an attempt to stabilize a fundamentally unstable system (FRB). It’s an attempt to patch a flaw in the system.
I did not mean to add the “no”
So again, why are banks in the Caribbean so stable?
Are you suggesting that foreign banks are unregulated and yet still engage in FRB?
I’m suggesting that offshore banks in the Caribbean (some of the Caribbean) have not gone under, despite not having anything comparable to modern deposit insurance.
You can also look back at the free banking experiment in Scotland.
I’m not sure what your overall point is or where you’re going with this. FDIC insurance doesn’t prevent banks from going under, it prevents runs on the bank from shutting them down (by preventing the panics).
Even fractional reserve banks can survive if they’re conservative and risk averse, which supposedly is largely the case in that area. Not to mention also (I believe) they aren’t investment banks down there, and they don’t appear to have a very strong connection to the US market that recently collapsed.
Theoretically a ponzi scheme could probably survive for decades too, under the right conditions (thus appearing legit), but that doesn’t make it stable, safe, or honest. (heh–social security)
If your point is that FR banks can survive without FDIC insurance, well, yeah I’m sure it’s possible to a degree (such as before the FDIC existed) but this still doesn’t address whether or not FRB is an honest, stable, or safe practice in comparison to full reserve banking.