Peter, my thoughts on the issues you mention are developed at length in my _Theory of Free Banking_. There is too much to the matter to try and summarize here.
Most of what I've read from Rothbard, Block, et al. is based on the fraudulence of FRB, which I dismiss. Standards of fraud are emergent, and usually depend on some standard disclosure of terms and thus risk. Nothing is inherently fraudulent any more than anything has inherent value. Their particular version of "libertarian law" or "natural law" or "ethics" notwithstanding.
Stuff like this:
http://mises.org/daily/1829#CASE
I've read Hulsmann, Hoppe, and de Soto and replies from White and Selgin on the economic viability of FRB. I am aware of their claims and arguments and find the anti-FRB side significantly weaker. However I nowhere stated that anyone who is opposed to FRB necessarily is not up to speed on the FRB side, but rather if they were it would be strategically silly to make a big issue out of it at all. I'm not sure than anyone has claimed FRB is necessarily or certainly unsustainable on a free market, I'm well aware of the claims of the people mentioned. If you have a particular article or an argument, point it out and I'll demonstrate my disagreement. I was talking more about the people in this forum anyway. I'm not a praxeologist and this will likely boil down to a difference in economic method, which would get you back to assertion (1).
do you think it is a non sequitur to claim that minimum price controls on Starbucks coffee will be unsustainable on a free market? What's the difference.
No difference, unless you define free market as that without intervention from an ideologically subsidized territorial monopoly on legitimized proactive physical coercion (the state) and specify such controls as state controls, in which case the statement would be internally inconsistent. A non-state entity could indeed sustain effective minimum price controls on Starbucks sans state intervention, through coercion or market power or whatever, however it is very highly unlikely given the incentives of a free market, the cost of coercion, and standard assumptions regarding human behavior.
"If you have a particular article or an argument, point it out and I'll demonstrate my disagreement."
Right here for starters:
http://mises.org/Community/forums/p/16302/328296.aspx#328296
"Peter, my thoughts on the issues you mention are developed at length in my _Theory of Free Banking_. There is too much to the matter to try and summarize here."
Sadly, I can't find an online version of the book or a good summary of the arguments (although Sechrest's Free Banking could be a substitute). Laziness, I mean, time preference rules. Discounting this topic, where I don't have sufficient insight into your position, let's see if we can build some bridges here and map out the (possible) disagreement. Can we agree on the following?
- the current system of fractional reserve banking as it is set up is fraudulent and unstable (with all the difficulties of defining a fraud... perhaps a more suitable word can be found)
- the free market is a preferred solution of the problems of banking
- FRB and full-reserve banking are very distinct modes of banking which should not be confused; the same is true for 'deposits' in each type of a bank, misrepresenting them does constitute fraud
Your contention then is, that the operation of an FRB can be stable (and desirable) in some conditions in the free market, which is where we so far differ, adding that it may have undesired consequences as noted above. We can probably agree, though, that FRBs on the free market, without special privileges and given the competition with full-reserve banks, will have a smaller effect on the overall economy. Is this correct from your point of view?
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hayekianxyz:Maybe you should take a course in money & banking. It's cool though, Dr Selgin teaches on I believe.
I second this.
Abstract liberty, like other mere abstractions, is not to be found.
- Edmund Burke
What book is this from?
Good Money
"Your contention then is, that the operation of an FRB can be stable (and desirable) in some conditions in the free market, which is where we so far differ, adding that it may have undesired consequences as noted above..."
i dont know the selgin or if what he writes is true or correct.
does a 100 percent reserve bank gurantee against something that a fractional resreve bank by its nature cannot??
my feeling is that a 2 percent bank note note in an aberden bank would likely be less valuable in brighton than a known fully backed gold or silver note.
discount after discount after discount. contract to me ,the next guy then the next ...i suppose it has happend where the bank note that was a contract gets farther and frather away from the orignal signers.
it just seems like a self limitiung process that..i thoght thats what the rothbard wrote about.
very low reserve rations... do you mean ratios???
" It is also why it would be far better to suffer a one-shot deflationary contraction of the fraudulent fractional-reserve banking system, and go back to a sound system of 100% reserves."
Read more: Making Economic Sense :: Free classics from the Mises Institute http://mises.org/econsense/ch78.asp#ixzz0nhGCdMr1
this appeared in mises sites. i am unaware if it is true. was there a system of 100 percent reserves to go back to??
is the above false???
if there was, how did it differ from today and was it problem free from a banking perspective??
i thought that i read that the govt destroyed the free baks described here. i dont know.
but if other historical descriptions of bank runs and difficulties getting specie and laws allowing the suspension of redemptioon are true it seems there was a nmarket preference for the not to have what it says. very often it seems that that was precioous metal coin.