CB is itself corruption, the bastaridization of interest rates based on the quackery of Keynes and his predecessors and successors in fraudulent scholarship..

The total savings of a society do not get affected by whether banks do FRB or not. The same amount of capital available for investment exists. FRB is not a magic potion.

My interest was peaked because I thought it curious that he would make such a mistake. But as you point out FRB does not necessarily imply that.
So when the FDIC steps in and grantees the deposits it would be the FDIC doing the counterfeiting and not the FRB?

Rothbard is wrong. The only point he may have is that point that FRBs should have to disclose that they are FRBs.. FRBs do not counterfeit anything. What they do is no different that issuing a bond.

I see. This is yet another example of a definition that is at best misleading. However it does clarify the remark about M. Rothbard being wrong about FRB being a form of counterfeiting.

"DEFINITION of 'Fractional Reserve Banking' A banking system in which only a fraction of bank deposits are backed by actual cash-on-hand and are available for withdrawal. This is done to expand the economy by freeing up capital that can be loaned out to other parties." From http://www.investopedia.com/terms/f/frac...

My comments were about the free market use of FRBs with widely varied asset classes (including but not restricted to metals) as security.

If a bank has reserves (gold, silver, mortgages, ...) that cover all of the notes that it has issued, how can it be called a "fractional" reserve bank? This would make a mockery of the meaning of "fractional".

hear hear

Thanks

Frastional Reserve Banking can be rational and logical and, when devoid of corruption, useful.

But any relationship to an objective standard of value for currency was buried in August, 1971.

Point taken, db. This is why Griffin says that to avoid the "longwindedness", you should read the summaries for each section first.

I think you are thinking of AS.

And so does the bond market and the stock market. It is incorrect to conflate a CB with FRB. In today's world they have been tied to each other, but the are not the same. A FRB backs its currency assets other than gold and silver, just like a bond or a stock. If a FRB makes bad decisions the currency goes away, just as bonds and stocks disappear if they do not back solid assets. This is totally different than a Central Bank, especially one that has the cover of legal tender laws.

Hmmm, I remember another book that has received similar commentary. ;^)

The problem I had with the book is that it is long winded and plays up the conspiracy side but not the understanding side.

The powers that be do not want people to understand. I remember studying FRB is my economics class and I understood it okay. But what really made it clear to me was learning the history of money and banking.

Two sides of the same fiat paper bill? :)

I assume your acceptable FRB's are free market disclosed (not legalese small print) and in competition with many others, none of which are legal tender. Personally I would also require a currency to have multiple independent private ratings as to their fraction of reserve and liquidity. I would suggest that any company rating a currency must have no dealings with that bank or in that currency, but that is my personal choice not a proposal for government regulation.
You can be certain that the kind of people that are banksters today will game any new economic system in order to cheat others. Yes, cheat, as they are producing nothing and stealing from others.
It may not be objectivist, buut I view money as a tool and the system that creates it needs to be as fair to all parties as possible. I would consider legislation that requires severe restitution penalties to anyone gaming the system. I recognize that any such legislation would have great difficulty dealing with innovation and would likely impair it. Competition in such legislation (regionally or by state, for example) would allow free market innovations to occur.

No, it is absolutely critical that one maintain semantic precision by not conflating "money" with "currency".

Money is a commodity which spontaneously evolves in the market. It cannot ever be created by fiat. Currency in its honest form is a bearer receipt for money which can be created by the holder of money..

The Midas bank cannot create money, it can only create a currency (i.e the FRN in the USA). If that ability is limited by government coercion then yes, Midas bank will have central control (by threat of violence)..