“The Radical Banking Reform that Would End the Boom and Bust in Banking”
“We all know what notes and coins are. They allow us to exchange the fruits of our work for the goods of others. When we deposit cash in Bank A – say £100 – we lend this money to the bank. But as soon as you make a deposit it becomes the bank’s. They then lend the £100 to say an entrepreneur, who banks it in bank B. Like magic, we now have you, who have a claim to “your” £100, and the entrepreneur, who also has an equally valid claim to “his” £100.” Read more.
“The Radical Banking Reform that Would End the Boom and Bust in Banking”
Toby Baxendale
The Telegraph.co.uk, September 15, 2010.
H/T to Pete Boettke at Coordination Problem.
Image by Gregory Szarkiewicz / FreeDigitalPhotos.net.
