At some point (hopefully) we’ll have to fix the banking system and prevent the boom-bust cycles. \u00a0Here’s a short list of requirements:<\/p>\n

\n
1. End fractional reserve lending. \u00a0All loans must come from deposits plus paid in capital.<\/li>\n
2. Eliminate Federal Reserve Notes and replace with the dollar.<\/li>\n
3. Preferably the dollar will be backed by gold, but there’s a chance all of our gold is gone.<\/li>\n
4. If we don’t have gold, switch to the green back. \u00a0These are dollars issued by the treasury. \u00a0The monetary base would grow 1% per year, i.e. the Treasury would issue 1% of monetary base each year and deposit the new money in the government account (reducing taxes).<\/li>\n
5. If GDP growth averaged 3%, we would have a mild deflation year in year out. \u00a0So you would see a 2% real raise each year in falling prices. \u00a0This is how economic productivity gains would be naturally spread out to the population.<\/li>\n
6. The FDIC would be eliminated.<\/li>\n
7. The Federal Reserve would become an insurance arm of the government, getting back to its original mission. \u00a0It would buy long term instruments (e.g. mortgages) at a discount, and pay out the cash to troubled banks. \u00a0So if your bank had a bank run, the bank would “repo” mortgages to the Fed, which would pay 90 cents on the dollar to the bank. \u00a0Once the emergency is over, the bank would repay the money and get their mortgages back.<\/li>\n
8. End government usury, i.e. no government debt.<\/li>\n
9. Reinstate Glass Steagall. \u00a0I don’t want my savings account dollars being invested in rehypothecated swaps on Albanian bond interest rate options.<\/li>\n<\/ol>\n

   Now I do have a problem with the greenback. \u00a0The problem is the 1% limit. \u00a0Given the history of our country where 90% of our government is unconstitutional (read the 9th and 10th amendment), you know they’d find a way around the 1% growth and start printing. \u00a0This is why I prefer gold. \u00a0However the greenback is superior to the Fed which quadrupled its balance sheet and is praying that the excess reserves don’t start draining into the economy (hyper inflation). \u00a0I think the economy is so dead from Obama that they are safe, but it is a big risk to take.<\/p>\n","protected":false},"excerpt":{"rendered":"

   At some point (hopefully) we’ll have to fix the banking system and prevent the boom-bust cycles. \u00a0Here’s a short list of requirements: End fractional reserve lending. \u00a0All loans must come from deposits plus paid in capital. Eliminate Federal Reserve Notes and replace with the dollar. Preferably the dollar will be backed by gold, but there’s…<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"libsyn-item-id":0,"libsyn-show-id":0,"libsyn-post-error":"","libsyn-post-error_post-type":"","libsyn-post-error_post-permissions":"","libsyn-post-error_api":"","playlist-podcast-url":"","libsyn-episode-thumbnail":"","libsyn-episode-widescreen_image":"","libsyn-episode-blog_image":"","libsyn-episode-background_image":"","libsyn-post-episode-category-selection":"","libsyn-post-episode-player_use_thumbnail":"none","libsyn-post-episode-player_use_theme":"mini","libsyn-post-episode-player_height":"50","libsyn-post-episode-player_width":"200","libsyn-post-episode-player_placement":"top","libsyn-post-episode-player_use_download_link":"","libsyn-post-episode-player_use_download_link_text":"","libsyn-post-episode-player_custom_color":"","libsyn-post-episode-itunes-explicit":"","libsyn-post-episode":"","libsyn-post-episode-update-id3":"","libsyn-post-episode-release-date":"","libsyn-post-episode-simple-download":"","libsyn-release-date":"","libsyn-post-update-release-date":"","libsyn-is_draft":"","libsyn-new-media-media":"","libsyn-post-episode-subtitle":"","libsyn-new-media-image":"","libsyn-post-episode-keywords":"","libsyn-post-itunes":"","libsyn-post-episode-itunes-episode-number":"","libsyn-post-episode-itunes-season-number":"","libsyn-post-episode-itunes-episode-type":"","libsyn-post-episode-itunes-episode-title":"","libsyn-post-episode-itunes-episode-author":"","libsyn-destination-releases":"","libsyn-post-episode-advanced-destination-form-data":"[]","libsyn-post-episode-advanced-destination-form-data-enabled":"","libsyn-post-episode-advanced-destination-form-data-input-enabled":false,"libsyn-post-episode-premium_state":"","libsyn-episode-shortcode":"","libsyn-episode-embedurl":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[7],"tags":[],"aioseo_notices":[],"jetpack_sharing_enabled":true,"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/www.jamesdeprisco.com\/wp-json\/wp\/v2\/posts\/259"}],"collection":[{"href":"https:\/\/www.jamesdeprisco.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.jamesdeprisco.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.jamesdeprisco.com\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.jamesdeprisco.com\/wp-json\/wp\/v2\/comments?post=259"}],"version-history":[{"count":2,"href":"https:\/\/www.jamesdeprisco.com\/wp-json\/wp\/v2\/posts\/259\/revisions"}],"predecessor-version":[{"id":261,"href":"https:\/\/www.jamesdeprisco.com\/wp-json\/wp\/v2\/posts\/259\/revisions\/261"}],"wp:attachment":[{"href":"https:\/\/www.jamesdeprisco.com\/wp-json\/wp\/v2\/media?parent=259"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.jamesdeprisco.com\/wp-json\/wp\/v2\/categories?post=259"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.jamesdeprisco.com\/wp-json\/wp\/v2\/tags?post=259"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}