considering bank loans are merely data into a computer, it's no real loss if a loan can't be paid back
because it was created out of thin air anyway , why do we hear in the media bnaks are reluctant to loan?
i get fractional reserve banking, i just don't get the ins and outs
if a bank can purchase a home, even an overvalued one, by creating moeny out of thin air, even if the home loses value, the bank still wins
I feel you haven't spent enough time studying the subject matter, and I think it's important to at least make an attempt to become reasonably familiar with the topics you are presenting on a forum board, before posting. Regarding fractional reserve banking I can recommend "What Has Government done to our Money?" by Murray Rothbard, which like most books, is hosted for free viewing online at mises.org. I enjoy purchasing hard copies of all the books but it is quite beneficial to those who may not share that same desire, that mises.org offers such phenomenally informative texts online for free.
Robert
Banks can create money out of thin air, but that leaves them with only a fraction of demand deposits. For example, lets say the bank has $100 in demand deposits,and they create $90 to loan. Unfortunately, this leaves the bank in a position to go bankrupt, if the people with demand deposits want to withdraw their money.
Banks are unwilling to make loans due to the inherent risk, and a contraction of the amount of credit.
Schools are labour camps.
Robert:reasonably familiar with the topics you are presenting on a forum board, before posting.
Isn't "reasonably familiar" somewhat arbitrary, especially regarding teenagers, who we should be ecstatic are even asking about this stuff? Most teens wouldn't even tolerate listening to someone telling them how fractional reserve banking actually works, let alone ask about it on their own volition.
I got a response like this to a confused question of mine a few years back on the Mises Blog: almost completely turned me off from reading mises.org (this was before I discovered Rothbard, which was the ancap event horizon for me).
Austrian Theory of the Business Cycle in 9 steps (Soliciting comments)