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Ideally banks should be done away with as soon as possible, that is for certain. Private institutions that control part of the the money supply in exchange for
by orbifold 11y ago
Ideally banks should be done away with as soon as possible, that is for certain. Private institutions that control part of the the money supply in exchange for taking on the risk of evaluating and assessing worthy recipients of credit is something that made sense before there was a supercomputer in everyones pocket. There are now already better alternatives. Replacing banks should be just one example of recovering centralised power for the people by means of technology.
- ApplaudPumice 11y agoI'm not good with economics, do you have any link which explains alternative models sans banks?
- smaddox 11y agoThe only role banks fulfill that couldn't easily be replaced by a digital currency is financing speculative investments by providing loans. Unfortunately loans also expand the money supply (and contract the money supply upon repayment/default), resulting in a positive feedback on investment, which can induce instability (i.e. the business cycle). It would be much better to decouple the money supply from investment. The money supply could be controlled either by a trusted agent (e.g. central bank), or possibly by a built-in stabilization algorithm (an interesting avenue for research), while investment could by financed privately. This would be the best of both worlds.