The Future of Finance - Page 2

psionl0 · 30th May 2012, 09:36 PM

Originally Posted by Sceptic-PK

You know your special brand of nonsense can keep bringing me back psi!

If this is going to be about who has the last word here then let it belong to your other friend:

Originally Posted by tensordyne

Show me the beef Sceptic-PK!

Sceptic-PK · 30th May 2012, 09:43 PM

I think solicitation on JREF is getting out of hand.

psionl0 · 30th May 2012, 10:11 PM

Typical! I find the nicest thing that tensordyne has ever said to you and you cry, "solicitation"!

Muldur · 2nd June 2012, 12:09 AM

Originally Posted by Sceptic-PK

There are already a dozen or more threads on this topic, I’ve already served my time with the nuts and their “money from thin air” meme. It was wasted time then and nothing has changed. There is nothing new you’ve yet posted so I find it funny you wish to call me ignorant. I’m sorry that you’ve fallen for the smoke and mirrors of the crazy people.

Translation: You can't refute the facts so you call names.

Classic avoidance behavior.

The process of money supply expansion via fractional reserve banking is obvious to anyone who doesn't drink the Ivory Tower Egghead Kool Aid.

Sceptic-PK · 2nd June 2012, 07:15 PM

I spent months refuting this nonsense you ignorant fool.

Speaking of "classic avoidance behaviour", why did you never respond to the pathetically stupid thread you made here?

http://forums.randi.org/showthread.php?t=233692

For what it's worth, I was embarrassed for you.

The Central Scrutinizer · 2nd June 2012, 07:19 PM

Originally Posted by Sceptic-PK

I spent months refuting this nonsense you ignorant fool.

Speaking of "classic avoidance behaviour", why did you never respond to the pathetically stupid thread you made here?

http://forums.randi.org/showthread.php?t=233692

For what it's worth, I was embarrassed for you.

This.

psionl0 · 2nd June 2012, 09:11 PM

Originally Posted by Sceptic-PK

I spent months ~~refuting~~ trying to refute this ~~nonsense~~ well accepted description of M1 money creation ~~you~~ but I am an ignorant fool.

ftfy.

psionl0 · 2nd June 2012, 11:26 PM

Originally Posted by The Central Scrutinizer

This guy (Sceptic-PK) is smarter than I am.

ftfy.

Muldur · 4th June 2012, 06:20 AM

Originally Posted by Puppycow

This?

It seems that liabilities have been created, but I can't see that new money has been created.

At Step 2 you still have only $100 in actual tangible money, but you have $190 in liabilities (plus interest). Bank A has $10 and is owed $90 plus interest. The loanee has $90 and owes $90 plus interest to Bank A. Bank A owes $100 plus interest (if any) to its depositor. The depositor doesn't have any money but is owed $100 plus interest by Bank A.

Step 3 seems to be totally unrelated to the first two steps. Where did Bank B come from and where did it get the $81 to loan someone?

The problem, which the first time I looked at this thread I didn't address, and which you seem to overlook or not understand, is that all parties are entitled to withdraw the full face value of their accounts at any given time.

The process actually looks more like this:

The system starts with no money at all.

Person A puts $100 into their account. They can at any time take out up to and including $100 out of that account. They for whatever reason do so. Total money in = $100. Total money out = $100. Net new money created=$0.

Using fractional reserve banking, the Bank loans out $90 to Person B. Person B deposits his $90 into his account, and is also entitled to withdraw the full amount at any time, even though he did not actually input $90 into the total system, but merely borrowed the use of it from the bank, and ultimately from Person A. He decides at the same time as Person A to do so.

So we have Person A withdrawing $100, and Person B withdrawing $90. Total money into the system still only =$100. Total money withdrawn=$190.
Net new money created = $90.

Rinse, repeat.

That's how banks in effect print new money, based on debt. It's also known in investment circles as "leveraging". It's a gamble that not all parties in the system at any one moment (or even a significant number) are likely to want the full face value of their accounts at any one time.

That gamble can come up "snake eyes" though, and that's when banks get hit with runs and wind up failing.

Muldur · 4th June 2012, 06:26 AM

Originally Posted by Sceptic-PK

I spent months refuting this nonsense you ignorant fool.

Speaking of "classic avoidance behaviour", why did you never respond to the pathetically stupid thread you made here?

http://forums.randi.org/showthread.php?t=233692

For what it's worth, I was embarrassed for you.

The case did happen, and is a matter of public record. That a corrupt superior court "overturned" the decision or refused to honor it in another case does not change the fact that the judge in the first case correctly declared the Federal Reserve Note to not be legal tender as defined Constitutionally.

Sceptic-PK · 4th June 2012, 08:34 PM

Originally Posted by Muldur

The case did happen, and is a matter of public record. That a corrupt superior court "overturned" the decision or refused to honor it in another case does not change the fact that the judge in the first case correctly declared the Federal Reserve Note to not be legal tender as defined Constitutionally.

Shows how much you bothered to research the case. The decision was not made by a judge. So take your tinfoil hat off.

Sceptic-PK · 4th June 2012, 08:38 PM

Originally Posted by Muldur

The problem, which the first time I looked at this thread I didn't address, and which you seem to overlook or not understand, is that all parties are entitled to withdraw the full face value of their accounts at any given time.

It isn’t a problem. It means customers can access the funds they have on deposit while that capital can be provided to others. Welcome to the wonders of fractional lending, which only crackpots have issue with.

Originally Posted by Muldur

That's how banks in effect print new money, based on debt.

Wrong. There is the same amount of money (reserves) in the system, just with more people having access to those same reserves. Anybody can do what you’re talking about, it is not a special ability of banks.

Originally Posted by Muldur

That gamble can come up "snake eyes" though, and that's when banks get hit with runs and wind up failing.

We’ll ignore the fact that this just doesn’t happen anymore though!

psionl0 · 4th June 2012, 09:18 PM

Originally Posted by Sceptic-PK

We’ll ignore the fact that this (bank runs) just doesn’t happen anymore though!

Sceptic-PK · 4th June 2012, 09:30 PM

When was the last time there was a run on US banks?

psionl0 · 4th June 2012, 09:34 PM

http://en.wikipedia.org/wiki/List_of...0%93present%29

Sceptic-PK · 4th June 2012, 09:42 PM

That’s not what I asked (and you know it, but you so love being a disingenuous pratt). I was talking about runs on banks, not bank collapses (which can occur for many reasons). Customer deposits are insured by the FDIC in the US or by the Federal Government in Oz for instance. Bank runs, where everyone desperately tries to get their deposits out, are not an issue in modern finance.

psionl0 · 4th June 2012, 10:50 PM

The Wiki lists 425 bank failures since 2008. If you want to show that none of these banks had a run then knock yourself out.

kevsta · 5th June 2012, 12:06 AM

Originally Posted by Sceptic-PK

Bank runs, where everyone desperately tries to get their deposits out, are not an issue in modern finance.

of course they do, its just done differently in some cases.

YouTube Video This video is not hosted by the JREF. The JREF can not be held responsible for the suitability or legality of this material. By clicking the link below you agree to view content from an external website.

I AGREE

Quote:

"on Thursday at 11am the Fed noticed a tremendous drawdown of money market accounts to the tune of $550 billion in an hour or two."

"we were having an electronic run on the banks"

Sceptic-PK · 5th June 2012, 12:25 AM

And what happened in that instance Kevsta? Did depositors lose their money?

kevsta · 5th June 2012, 03:14 AM

Originally Posted by Sceptic-PK

And what happened in that instance Kevsta?

ok, so they dont happen apart from that instance?

Originally Posted by Sceptic-PK

Did depositors lose their money?

irrelevant, overruled.

and this is me sticking to your "modern finance = US bank failures" they are happening across Europe as we speak and the UK had a big queue up outside Northern Rock not so long ago

you are talking tosh to say they dont happen in modern finance

Sceptic-PK · 5th June 2012, 04:29 AM

Ok I'll rephrase.

How often are banks unable to meet the demands of their depositors because of fractional lending; "banks" in this case will include the relevant depositor insurance schemes, and the lendors of last resort etc.

The GFC was not caused by fractional lending or people taking their deposits out of the bank all at once. So I would like to know of examples of this happening, in the way that Muldur originally stated,

Quote:

That gamble can come up "snake eyes" though, and that's when banks get hit with runs and wind up failing.

in times more recent than the Great Depression. I'll accept that maybe it has happened recently, but I'd like a couple of examples.

Muldur · 11th June 2012, 10:34 AM

Originally Posted by Sceptic-PK

When was the last time there was a run on US banks?

September 18, 2008, to the tune of nearly a half-TRILLION dollars before the Fed was able to put the breaks on it.

The only difference was that it was being done electronically instead of lines of people waiting for cash money.

References numerous. Just type "September 2008 run on banks" into search engine of choice.

Here's one good summary though:

http://www.creditwritedowns.com/2009...t-18-2008.html

Muldur · 11th June 2012, 10:42 AM

Originally Posted by Sceptic-PK

Ok I'll rephrase.

How often are banks unable to meet the demands of their depositors because of fractional lending; "banks" in this case will include the relevant depositor insurance schemes, and the lendors of last resort etc.

The GFC was not caused by fractional lending or people taking their deposits out of the bank all at once. So I would like to know of examples of this happening, in the way that Muldur originally stated,

in times more recent than the Great Depression. I'll accept that maybe it has happened recently, but I'd like a couple of examples.

Greece has been in the middle of one off and on for weeks now, to name another.

Sceptic-PK · 11th June 2012, 04:17 PM

Clearly somebody didn’t understand the question, lol.

FYI, that frontline documentary doesn’t mention fractional lending even once.

Greece’s primary problems are related to sovereign debt levels. This too has nothing to do with fractional lending. Get your facts straight.

30th May 2012, 09:36 PM	#41
psionl0 Illuminator Join Date: Sep 2010 Location: 31°58'S 115°57'E Posts: 4,789	Originally Posted by Sceptic-PK You know your special brand of nonsense can keep bringing me back psi! If this is going to be about who has the last word here then let it belong to your other friend: Originally Posted by tensordyne Show me the beef Sceptic-PK!
	Last edited by psionl0; 30th May 2012 at 09:37 PM.

2nd June 2012, 12:09 AM	#44
Muldur Graduate Poster Join Date: Aug 2010 Posts: 1,968	Originally Posted by Sceptic-PK There are already a dozen or more threads on this topic, I’ve already served my time with the nuts and their “money from thin air” meme. It was wasted time then and nothing has changed. There is nothing new you’ve yet posted so I find it funny you wish to call me ignorant. I’m sorry that you’ve fallen for the smoke and mirrors of the crazy people. Translation: You can't refute the facts so you call names. Classic avoidance behavior. The process of money supply expansion via fractional reserve banking is obvious to anyone who doesn't drink the Ivory Tower Egghead Kool Aid.
Muldur Graduate Poster Join Date: Aug 2010 Posts: 1,968

2nd June 2012, 07:19 PM	#46
The Central Scrutinizer Penultimate Amazing Join Date: Dec 2001 Location: The White Zone Posts: 42,278	Originally Posted by Sceptic-PK I spent months refuting this nonsense you ignorant fool. Speaking of "classic avoidance behaviour", why did you never respond to the pathetically stupid thread you made here? http://forums.randi.org/showthread.php?t=233692 For what it's worth, I was embarrassed for you. This.
	__________________ If I see somebody with a gun on a plane? I'll kill him.

4th June 2012, 06:20 AM	#49
Muldur Graduate Poster Join Date: Aug 2010 Posts: 1,968	Originally Posted by Puppycow This? It seems that liabilities have been created, but I can't see that new money has been created. At Step 2 you still have only $100 in actual tangible money, but you have $190 in liabilities (plus interest). Bank A has $10 and is owed $90 plus interest. The loanee has $90 and owes $90 plus interest to Bank A. Bank A owes $100 plus interest (if any) to its depositor. The depositor doesn't have any money but is owed $100 plus interest by Bank A. Step 3 seems to be totally unrelated to the first two steps. Where did Bank B come from and where did it get the $81 to loan someone? The problem, which the first time I looked at this thread I didn't address, and which you seem to overlook or not understand, is that all parties are entitled to withdraw the full face value of their accounts at any given time. The process actually looks more like this: The system starts with no money at all. Person A puts $100 into their account. They can at any time take out up to and including $100 out of that account. They for whatever reason do so. Total money in = $100. Total money out = $100. Net new money created=$0. Using fractional reserve banking, the Bank loans out $90 to Person B. Person B deposits his $90 into his account, and is also entitled to withdraw the full amount at any time, even though he did not actually input $90 into the total system, but merely borrowed the use of it from the bank, and ultimately from Person A. He decides at the same time as Person A to do so. So we have Person A withdrawing $100, and Person B withdrawing $90. Total money into the system still only =$100. Total money withdrawn=$190. Net new money created = $90. Rinse, repeat. That's how banks in effect print new money, based on debt. It's also known in investment circles as "leveraging". It's a gamble that not all parties in the system at any one moment (or even a significant number) are likely to want the full face value of their accounts at any one time. That gamble can come up "snake eyes" though, and that's when banks get hit with runs and wind up failing.
Muldur Graduate Poster Join Date: Aug 2010 Posts: 1,968

4th June 2012, 06:26 AM	#50
Muldur Graduate Poster Join Date: Aug 2010 Posts: 1,968	Originally Posted by Sceptic-PK I spent months refuting this nonsense you ignorant fool. Speaking of "classic avoidance behaviour", why did you never respond to the pathetically stupid thread you made here? http://forums.randi.org/showthread.php?t=233692 For what it's worth, I was embarrassed for you. The case did happen, and is a matter of public record. That a corrupt superior court "overturned" the decision or refused to honor it in another case does not change the fact that the judge in the first case correctly declared the Federal Reserve Note to not be legal tender as defined Constitutionally.
Muldur Graduate Poster Join Date: Aug 2010 Posts: 1,968

30th May 2012, 09:43 PM	#42
Sceptic-PK Master Poster Join Date: Jun 2010 Posts: 2,401	I think solicitation on JREF is getting out of hand.

30th May 2012, 10:11 PM	#43
psionl0 Illuminator Join Date: Sep 2010 Location: 31°58'S 115°57'E Posts: 4,789	Typical! I find the nicest thing that tensordyne has ever said to you and you cry, "solicitation"!

2nd June 2012, 07:15 PM	#45
Sceptic-PK Master Poster Join Date: Jun 2010 Posts: 2,401	I spent months refuting this nonsense you ignorant fool. Speaking of "classic avoidance behaviour", why did you never respond to the pathetically stupid thread you made here? http://forums.randi.org/showthread.php?t=233692 For what it's worth, I was embarrassed for you.

2nd June 2012, 09:11 PM	#47
psionl0 Illuminator Join Date: Sep 2010 Location: 31°58'S 115°57'E Posts: 4,789	Originally Posted by Sceptic-PK I spent months ~~refuting~~ trying to refute this ~~nonsense~~ well accepted description of M1 money creation ~~you~~ but I am an ignorant fool. ftfy.

2nd June 2012, 11:26 PM	#48
psionl0 Illuminator Join Date: Sep 2010 Location: 31°58'S 115°57'E Posts: 4,789	Originally Posted by The Central Scrutinizer This guy (Sceptic-PK) is smarter than I am. ftfy.

4th June 2012, 08:34 PM	#51
Sceptic-PK Master Poster Join Date: Jun 2010 Posts: 2,401	Originally Posted by Muldur The case did happen, and is a matter of public record. That a corrupt superior court "overturned" the decision or refused to honor it in another case does not change the fact that the judge in the first case correctly declared the Federal Reserve Note to not be legal tender as defined Constitutionally. Shows how much you bothered to research the case. The decision was not made by a judge. So take your tinfoil hat off.

4th June 2012, 08:38 PM	#52
Sceptic-PK Master Poster Join Date: Jun 2010 Posts: 2,401	Originally Posted by Muldur The problem, which the first time I looked at this thread I didn't address, and which you seem to overlook or not understand, is that all parties are entitled to withdraw the full face value of their accounts at any given time. It isn’t a problem. It means customers can access the funds they have on deposit while that capital can be provided to others. Welcome to the wonders of fractional lending, which only crackpots have issue with. Originally Posted by Muldur That's how banks in effect print new money, based on debt. Wrong. There is the same amount of money (reserves) in the system, just with more people having access to those same reserves. Anybody can do what you’re talking about, it is not a special ability of banks. Originally Posted by Muldur That gamble can come up "snake eyes" though, and that's when banks get hit with runs and wind up failing. We’ll ignore the fact that this just doesn’t happen anymore though!

4th June 2012, 09:18 PM	#53
psionl0 Illuminator Join Date: Sep 2010 Location: 31°58'S 115°57'E Posts: 4,789	Originally Posted by Sceptic-PK We’ll ignore the fact that this (bank runs) just doesn’t happen anymore though!

4th June 2012, 09:30 PM	#54
Sceptic-PK Master Poster Join Date: Jun 2010 Posts: 2,401	When was the last time there was a run on US banks?

4th June 2012, 09:34 PM	#55
psionl0 Illuminator Join Date: Sep 2010 Location: 31°58'S 115°57'E Posts: 4,789	http://en.wikipedia.org/wiki/List_of...0%93present%29

4th June 2012, 09:42 PM	#56
Sceptic-PK Master Poster Join Date: Jun 2010 Posts: 2,401	That’s not what I asked (and you know it, but you so love being a disingenuous pratt). I was talking about runs on banks, not bank collapses (which can occur for many reasons). Customer deposits are insured by the FDIC in the US or by the Federal Government in Oz for instance. Bank runs, where everyone desperately tries to get their deposits out, are not an issue in modern finance.

4th June 2012, 10:50 PM	#57
psionl0 Illuminator Join Date: Sep 2010 Location: 31°58'S 115°57'E Posts: 4,789	The Wiki lists 425 bank failures since 2008. If you want to show that none of these banks had a run then knock yourself out.

5th June 2012, 12:25 AM	#59
Sceptic-PK Master Poster Join Date: Jun 2010 Posts: 2,401	And what happened in that instance Kevsta? Did depositors lose their money?

5th June 2012, 03:14 AM	#60
kevsta RBL CHeck Failed Join Date: Jun 2007 Location: in the shadows Posts: 2,484	Originally Posted by Sceptic-PK And what happened in that instance Kevsta? ok, so they dont happen apart from that instance? Originally Posted by Sceptic-PK Did depositors lose their money? irrelevant, overruled. and this is me sticking to your "modern finance = US bank failures" they are happening across Europe as we speak and the UK had a big queue up outside Northern Rock not so long ago you are talking tosh to say they dont happen in modern finance
	__________________ "The world will soon wake up to the reality that everyone is broke and can collect nothing from the bankrupt, who are owed unlimited amounts by the insolvent, who are attempting to make late payments on a bank holiday in the wrong country, with an unacceptable currency, against defaulted collateral, of which nobody is sure who holds title." - Anonymous Last edited by kevsta; 5th June 2012 at 03:16 AM.

5th June 2012, 04:29 AM	#61
Sceptic-PK Master Poster Join Date: Jun 2010 Posts: 2,401	Ok I'll rephrase. How often are banks unable to meet the demands of their depositors because of fractional lending; "banks" in this case will include the relevant depositor insurance schemes, and the lendors of last resort etc. The GFC was not caused by fractional lending or people taking their deposits out of the bank all at once. So I would like to know of examples of this happening, in the way that Muldur originally stated, Quote: That gamble can come up "snake eyes" though, and that's when banks get hit with runs and wind up failing. in times more recent than the Great Depression. I'll accept that maybe it has happened recently, but I'd like a couple of examples.

11th June 2012, 10:34 AM	#62
Muldur Graduate Poster Join Date: Aug 2010 Posts: 1,968	Originally Posted by Sceptic-PK When was the last time there was a run on US banks? September 18, 2008, to the tune of nearly a half-TRILLION dollars before the Fed was able to put the breaks on it. The only difference was that it was being done electronically instead of lines of people waiting for cash money. References numerous. Just type "September 2008 run on banks" into search engine of choice. Here's one good summary though: http://www.creditwritedowns.com/2009...t-18-2008.html
Muldur Graduate Poster Join Date: Aug 2010 Posts: 1,968	Last edited by Muldur; 11th June 2012 at 10:38 AM.

11th June 2012, 10:42 AM	#63
Muldur Graduate Poster Join Date: Aug 2010 Posts: 1,968	Originally Posted by Sceptic-PK Ok I'll rephrase. How often are banks unable to meet the demands of their depositors because of fractional lending; "banks" in this case will include the relevant depositor insurance schemes, and the lendors of last resort etc. The GFC was not caused by fractional lending or people taking their deposits out of the bank all at once. So I would like to know of examples of this happening, in the way that Muldur originally stated, in times more recent than the Great Depression. I'll accept that maybe it has happened recently, but I'd like a couple of examples. Greece has been in the middle of one off and on for weeks now, to name another.
Muldur Graduate Poster Join Date: Aug 2010 Posts: 1,968

11th June 2012, 04:17 PM	#64
Sceptic-PK Master Poster Join Date: Jun 2010 Posts: 2,401	Clearly somebody didn’t understand the question, lol. FYI, that frontline documentary doesn’t mention fractional lending even once. Greece’s primary problems are related to sovereign debt levels. This too has nothing to do with fractional lending. Get your facts straight.
	Last edited by Sceptic-PK; 11th June 2012 at 04:19 PM.