Talk:Criticism of fractional reserve banking

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The page needs a remake

Okay. This page needs a serious makeover. With way over 200 kBytes and 500 references it has turned into an unreadable monster. It should be cut in half at least.


  • Clarify what is the purpose of this page - and stick to it.
  • Neutrally summarize the subject criticized.
  • Sort the critiques into distinctive groups, if possible.
  • Cut down on the emotional calls against the phenomenon. Feels good, doesn't help.
  • There is a lot of criticism of the most varied government interventions of unknown relevance. Cut it out.
  • FRB may be bad, but it doesn't run the world.

Oh and... references:

  • It's good to have many of those, but 500?
  • Find the best representatives for a given statement.
  • Please watch out for using multiple references for a single point. In one place I've noticed 12(!)

I admit I didn't read all of it - it's simply too hard for me, sorry. I overlooked this for a long while and now I can't even figure out what the main criticisms are, which of them are Austrian and where to pick up the arguments. Pestergaines 02:27, 30 September 2011 (MSD)

The monster is not the article but rather the fractional reserve system itself :-). I agree though. Response and suggestions to be found here. Perhaps clean up slowly over time, when the mood takes you, in between watching riots on Wall Street and in Athens... - Karmaisking 08:13, 9 October 2011 (MSD)
"in Athens"... the more things change... - Karmaisking (talk) 01:29, 29 June 2015 (EDT)

Shorthand summary for this article: "We Will End Up With Food or Water Shortages - But Amazing SmartPhones!"

I've finally got a reference I need for the water shortage issue. So just to summarize the big picture right now:

1. Federal Reserve and its proxies control most markets. They are pushing interest rates down, housing up, stocks up and bonds up. This will create excess supply in those markets (market price analysis 101). 2. Via Michael Rowbotham's analysis, unfettered FRB distorts pricing which in turn favors property developers over farmers (and via ABCT, high-tech higher order capital expenditures in iphones etc), hence the most fertile and productive farmland will be systematically destroyed through perverse price incentives, exacerbated by (1) continuing indefinitely to stave off another financial crisis. 3. Water is underpriced by government monopoly control. Therefore in addition to all the mispricing caused by (1) and (2) we will have undersupply of quality fresh water for farming and human/animal consumption.

Therefore there will be a water/food/pollution/social crisis before the next financial crisis. This is almost (almost!) praxeological because it simply and logically works through the underpricing and overpricing of various crucial goods affected by central bank supported FRB combined with government control of water resources (and the associated underpricing). Couldn't be easier to work out. It's rent controls applied on a massive worldwide scale to land and water resources. So why aren't there more "environmental" Austrians out there, other than Rothbard? - Karmaisking (talk) 00:49, 4 September 2014 (EDT)

And now I even have a reference for the above analysis. Here. So simple to work out. Can anyone find a summary of the approximate dates for the exhaustion of the main aquifers in California? That would be an interesting factoid.
Partial answer here. This, I believe, is the true power of applied Austrian economics. Relentlessly analyzing the under- or over- pricing of goods caused by distortions intrinsic in the current monetary system. Who predicted, five years ago, a water crisis caused by, of all things, fractional reserve banking? You, dear reader, are amongst the very select few who saw it first. - Karmaisking (talk) 19:53, 5 October 2014 (EDT)