> The fractional reserve system The fractional reserve system does not exist: > Fractional reserve banking is the idea that banks take their reserves and lend

> The fractional reserve system The fractional reserve system does not exist: > Fractional reserve banking is the idea that banks take their reserves and lend them into some fraction based on the quantity of reserves they hold. This idea has been largely debunked since the financial crisis. In reality, banks do not lend their reserves, except to one another inside of the reserve system (which is a closed system, ie, reserves don’t even leave the system). They don’t even lend based on the quantity of reserves they hold. * https://www.pragcap.com/what-is-fractional-reserve-banking/ https://www.pragcap.com/what-is-fractional-reserve-banking/ * https://www.pragcap.com/r-i-p-the-money-multiplier/ https://www.pragcap.com/r-i-p-the-money-multiplier/ * https://research.stlouisfed.org/publications/page1-econ/2021/09/17/teaching-the-linkage-between-banks-and-the-fed-r-i-p-money-multiplier https://research.stlouisfed.org/publications/page1-econ/2021... Some countries don't even have reserver requirements: * https://en.wikipedia.org/wiki/Reserve_requirement#Countries_and_districts_without_reserve_requirements https://en.wikipedia.org/wiki/Reserve_requirement#Countries_... Tobin called the relending of deposits the "Old View" in 1963: * https://ideas.repec.org/p/cwl/cwldpp/159.html https://ideas.repec.org/p/cwl/cwldpp/159.html > Remove usury (loans at a profit) and base the national currency on something […] There was more instability in the US under the gold standard than in the recent (7+) decades under fiat: * https://www.theatlantic.com/business/archive/2012/08/why-the-gold-standard-is-the-worlds-worst-economic-idea-in-2-charts/261552/ https://www.theatlantic.com/business/archive/2012/08/why-the... * https://archive.is/FWKcL https://archive.is/FWKcL And if you think fiat encourages financial speculation, and the gold standard reduces it: * https://en.wikipedia.org/wiki/Panic_of_1873 https://en.wikipedia.org/wiki/Panic_of_1873