RickRussellTX

My Economic Plan

Yeah, I cannot see how eliminating fractional reserve banking fixes any problems. If anything, it dramatically worsens liquidity problems -- look at the national bank system before the Federal Reserve existed. If depositors took out money, the bank had to demand immediate payment on loans. It makes sense in theory, until you find out that the letter of credit you sent to the lumber mill just got pulled. Do we really want to go back to the days of couriers carrying gold and paper currency to pay for business transactions? Without the ability to rely on short-term lines of credit, that is what will happen.