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... of mine, and reserve banking is no Ponzi scheme.

That is, to be precise, reserve banking is not intrinsically a Ponzi scheme ... provided the credit contract created by the bank is sound, the credit money is sound.

What is required to prepare reserve banking for the post-peak loss of ongoing extensive growth, to be replaced at best by periodic waves of technology driven intensive growth, is a return to low and stable cash rates and regulation of banking operations to require prudent behavior.

Or, in other words, all those prudential regulatory schemes instituted in financial centers after the Great Depression, which have been progressively stripped away since the 60's.


I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.

by BruceMcF (agila61 at netscape dot net) on Sun Aug 19th, 2007 at 04:50:39 PM EST
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