Bernanke Wants to Eliminate Reserve Requirements Completely

Discussion in 'Economy' started by PubliusInfinitum, Mar 18, 2010.

  1. PubliusInfinitum
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    PubliusInfinitum BANNED

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    Bernanke Wants to Eliminate Reserve Requirements Completely

    "Up until now, the United States has operated under a "fractional reserve" banking system. Banks have always been required to keep a small fraction of the money deposited with them for a reserve, but were allowed to loan out the rest. But now it turns out that Federal Reserve Chairman Ben Bernanke wants to completely eliminate minimum reserve requirements, which he says "impose costs and distortions on the banking system". At least that is what a footnote to his testimony before the U.S. House of Representatives Committee on Financial Services on February 10th says. So is Bernanke actually proposing that banks should be allowed to have no reserves at all?

    That simply does not make any sense. But it is right there in black and white on the Federal Reserve's own website...."


    I just ran up on this article this morning... not saying that it's true; but if it is... we are beyond screwed.

    What do YOU think?
     
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  2. Ravi
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    Ravi Diamond Member

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    Color me surprised. I thought you were a free market, no regulation type of guy, Pubic.

    I wonder if you'd be upset about this under a Republican administration.

    :eusa_eh:
     
  3. Contumacious
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    Contumacious Radical Freedom

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  4. Kevin_Kennedy
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    Kevin_Kennedy Defend Liberty

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    Fractional reserve banking is a massive fraud on anyone who deposits their money in a bank, but no reserve banking would be even worse. The only thing we should be moving towards is 100% reserve banking.
     
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  5. editec
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    editec Mr. Forgot-it-All

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    I think that if you believe REGULATING CAPITALISM is bad, then you cannot object to this DEREGULATION.

    However, if you do understand that markets need regulation, then you might object to this plan as essantially boneheaded.

    But given that our entire system is boneheadedly stupid, and DESIGNED to benefit a very small class of our overall population, this doesn't really much surprise me.

    Banks and the monied class OWN this country folks.

    Hell the whole capitalization of banks concept was basically thrown away a long long time ago, anyway.

    I ALSO want the right to loan money I do not have to other people at interest.

    I have no money, so clearly I am as financially prepared to do it as most major banks are.
     
  6. Toro
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    Toro Diamond Member

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    The guy who knows most about these things is gonegolfin. Hopefully, he will post here.

    As I read it, Bernanke is talking about the reserve balances at the Federal Reserve, not reserves altogether. Banks would still have to have minimum capital requirements. This may or may not be a good idea but I don't think he is proposing to get rid of reserves in general. If so, that's a terrible idea.

    In fact, the government is likely to go the other way and increase reserve requirements. Of all the proposed regulations, this is probably the best one.
     
  7. Mr.Fitnah
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    Mr.Fitnah Dreamcrusher

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    This will cool off the printing press for a day.
     
  8. PatekPhilippe
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    PatekPhilippe Senior Member

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    What? You can't be serious...this would NEVER be proposed under a Republican Administration....the reason it's proposed now is Bernanke sees the governments willingness to step in and give banks BILLIONS of our tax dollars if they lose it all in some scheme!!!! Are you a supporter of this socialist crap?
     
  9. beowolfe
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    beowolfe Senior Member

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    I know it's hard. But try not being a jackazz all of the time! It was a REPUBLICAN administration that GAVE the banks billions. WAKE UP!!!
     
  10. PatekPhilippe
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    PatekPhilippe Senior Member

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    Are you refering to TARP...THAT'S BEING REPAID AS WE SPEAK unlike your Lord and Master Obama's great giveaway to Wall Street? Yes...you should take your own advice dumb ass.
     
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