South Carolina Lawmaker Seeks to Ban Federal Currency

Yeah, it can. Happens every time someone takes out a loan from a bank.

nice selective quote. what you said wouldn't happen if you didn't have the fed reserve.


Uhhh, no. Banks have made loans almost since their inception, thus creating money "out of thin air". The Federal Reserve didn't invent the loan.

Until the great recession of 2008 caused by the collapse of big banks, they were required to have collateral assets to back up loans. They didn't, and there you have the answer to "what happened" in a few short words.
 
And for heavens sake do not pull out a checkbook or the entire store stops and stares at you!



Yeah WTF is up with those checkbook people? Are they not aware a debit card is functionally identical - you can pay for something without having the cash on you, you have a record of the transaction, and you have a bank facilitating the transaction.

Debit cards are the most frequently used vehicle for identity thieves. I always use my debit card, but choose the "credit" option because I don't have to put in my pin number.
 
And for heavens sake do not pull out a checkbook or the entire store stops and stares at you!



Yeah WTF is up with those checkbook people? Are they not aware a debit card is functionally identical - you can pay for something without having the cash on you, you have a record of the transaction, and you have a bank facilitating the transaction.

Debit cards are the most frequently used vehicle for identity thieves. I always use my debit card, but choose the "credit" option because I don't have to put in my pin number.



That's only because they are so frequently used. Before debit cards people used checks to rip others off.
 
Until the great recession of 2008 caused by the collapse of big banks, they were required to have collateral assets to back up loans.

The banks only hold the titles to the collateral assets, not the assets themselves.

I think we're getting confused between the difference between the large lending institutions and small community banks insured by the FDIC. Big banks like Lehman Brothers and Bear Stearns were not insured, and the reason they went under is because they had no leverage to back them up if a run on their "banks" by investors had happened. In fact, the "fee" that Obama is proposing would basically establish a type of "insurance" for these larger lending institutions, similar to the FDIC, so that should they return to casino shenanigans and fail, they would need to dig into their own "insurance" funds to dig themselves out instead of expecting the federal government (taxpayers) to bail them out.
 

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