Comments on Market Skeptics: *****US Banks Operating Without Reserve Requiremen...

This law has already been written. It was called ...

2009-06-19T08:53:27.467-07:00

This law has already been written. It was called the "Emergency Economic Stabilization Act of 2008" which was passed in October of last year.

You can see a write up explaining it here:
http://www.dailypaul.com/node/65803

It was buried deep in several layers of legislation. The really interesting bit: it was originally scheduled to happen in 2011 but was moved up to 2008 in that bill.

The tone of the article is amazement that the Fed ...

2009-03-31T10:27:00.000-07:00

The tone of the article is amazement that the Fed is not protecting the interests of the American people. Of course it isn't: the Fed wasn't set up to protect them. It was set up to ensure that the profits of its shareholders, the big banks like Citi and BofA, were maximized, while any losses were passed on to the public.

The Fed is not a government agency. It is a banking cartel, and it acts to preserve the power and profits of its member banks, the same banks that are receiving trillions in bailouts and taxpayer loan guarantees.

This is all explained clearly in G. Edward Griffin's book "The Creature from Jekyll Island." See in particular Chapter 2: "The Name of the Game is Bailout."

It's worse than you think: your bank's vault cash ...

2009-03-31T03:53:00.000-07:00

It's worse than you think: your bank's vault cash might not be available to your bank. A few years ago, I looked at the free standing ATM machine industry. (Picture the no name ATM machine in a no name convenience store). Often the convenience store doesn't have 10k or so to tie up in the ATM machine, so they "lease" cash from the armored car service that services the machine and removes deposits. The armored car service, in turn, "leases" the cash from a bank, which might be across the country. Unless the rules have changed in the last 2-3 years, since that bank still owns the currency, it can count it towards vault cash, even though it is in a Stop-N-Rob a thousand miles away from the nearest bank branch, and would be unavailable to the bank in a timely fashion in the event of a bank run.

Mr DeCarbonnel,Nice piece. I have said it more tha...

2009-03-30T16:19:00.000-07:00

Mr DeCarbonnel,

Nice piece. I have said it more than once: About a month ago we may have been on the ledge of a complete systemic collapse than at any point in the 50+ years (amazingly unnoticed). Our largest US bank, Bank of America was on the verge of collapsing and the public was mostly unaware. I can only imagine that if the general public was aware would have brought a mass exodus of withdrawals only to come out empty-handed. This may have concluded in riots and who knows what else. Whehh! Close call...

Looks like credit unions are getting into deposit ...

2009-03-30T11:18:00.000-07:00

Looks like credit unions are getting into deposit reclassification too:

Still relatively new to credit unions, deposit reclassification has been around since 1993 when the Federal Reserve Bank allowed the practice to occur. Banks have flocked to the account structuring more with roughly 2,000 of them approved by the Fed to engage in the process. Wright estimates that there are about 100 credit unions involved in deposit reclassification. The credit union numbers are smaller because financial institutions are required to first have $50 million in checking accounts in accordance with Fed reserve requirements, he explained.
Deposit Reclassification still relatively new to credit unions

Fractional reserve banking deserves just as much b...

2009-03-30T10:09:00.000-07:00

Fractional reserve banking deserves just as much blame if not more blame than even the government engaging in currency debasement (inflation).

Why fractional reserve banking gets a free pass is beyond my ken.

We need to go to a full reserve banking system with a gold backed currency. Sure growth would be slow and methodical with prices steadily FALLING if you can believe that, but it would be a more solid economy than at present.

These boom and bust cycles are caused by malinvestments that eventually overcome any true economic progress. The best way to reduce these malinvestments are to have a sound currency and especially a sound banking system based on FULL reserves (or as close as possible to that notion).

Thank you for raising the issue of franctional reserve banking which is woefully undiscussed and probably the KEY POINT to the reason why we are in the dire straights we're in.

So - any idea if there is something similar in the...

2009-03-30T04:46:00.000-07:00

So - any idea if there is something similar in the Credit Union system?

if i'm not mistaken, i believe there was something...

2009-03-30T01:14:00.000-07:00

if i'm not mistaken, i believe there was something in one of the recovery acts in the early days of oct, 2008 which stated that reserves were in effect nil.

see if you can find something relative to that. i'm pretty sure it was reported as such (of course in the altenrative community where people had read the bills :)