Under a fiat monetary system, banks issue loans and create deposits for clients many times their cash reserves. This system is spectacularly profitable for banks since it allows them to keep their money in one place while lending in another location, the fiat version of a bitcoin double-spend transaction. A bank can operate on fractional reserves perfectly fine unless and until a critical mass of its customers all come calling for their holdings... Should the fractional reserve house of cards begin to collapse, as it inevitably will, the banks know that the government will simply conjure credit out of thin air to bail them out.
Ammous, Saifedean. The Fiat Standard: The Debt Slavery Alternative to Human Civilization
₿rMoon /
npub10m…xgyne
2023-03-08 03:01:44
Author Public Key
npub10m00n0ek7y70zl4yp40hlpz9nhyajt3chu36tnrhlfsrcn4eglmsjxgynePublished at
2023-03-08 03:01:44Event JSON
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"content": "Under a fiat monetary system, banks issue loans and create deposits for clients many times their cash reserves. This system is spectacularly profitable for banks since it allows them to keep their money in one place while lending in another location, the fiat version of a bitcoin double-spend transaction. A bank can operate on fractional reserves perfectly fine unless and until a critical mass of its customers all come calling for their holdings... Should the fractional reserve house of cards begin to collapse, as it inevitably will, the banks know that the government will simply conjure credit out of thin air to bail them out.\n\nAmmous, Saifedean. The Fiat Standard: The Debt Slavery Alternative to Human Civilization",
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}