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You can't give out loans really without fractional banking either. I mean you can. But not really.
by roflyear 4y ago
You can't give out loans really without fractional banking either. I mean you can. But not really.
- DANmode 4y agoYou could. Banks, bolstered nightly with USD loans from this Fed, could not.
- roflyear 4y agoWell, you technically can, but few individuals will be issuing mortgages to the average joe.
- alxmng 4y agoThe majority of business capitalization isn’t a loan, but invested savings in return for equity. All of venture capital, the stock market, small business using their own funds, etc. Mortgages are collateralized, and business loans can be secured with assets or equity. I suspect the majority of bank loans are mortgages (?). Interest rates do not need to be high without fractional banking, since loans can be secured.
- roflyear 4y agoWho is going to issue mortgages, if not banks?
- hd95489 4y agoBanks only do community and jumbo in the us. Most mortgages are owned by the federal government
- alxmng 4y agoBanks can issue mortgages without fractional banking… Investors pool capital and start a bank. The bank loans money for homes and makes a profit from interest.
- roflyear 4y agoI suppose, but wouldn't really need a bank for that. And you need a lot of money - more money I'd wager than investors will want to pool together. But, I guess if your goal is less people being able to get mortgages and loans, maybe it will be a good thing!