Bank-Debt-Backed Fiat Currency
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A Bank-Debt-Backed Fiat Currency is a fiat currency with less than 100% bank reserve requirement (where banks are allowed to lend more than they have in loans).
- Example(s):
- in
- See: Bank-Debt-Free Fiat Currency, Bank Reserves.
References
2016
- http://theguardian.com/global-development-professionals-network/2016/nov/05/how-a-new-money-system-could-help-stop-climate-change
- QUOTE: So where does all that additional money come from? Banks create it out of thin air when they make loans – they loan it into existence. This accounts for about 90% of the money circulating in our economy right now. It’s not created by the government, as most people assume: it is created by commercial banks in the form of loans. In other words, almost every dollar that passes through our hands represents somebody’s debt. And every dollar of debt has to be paid back with interest. Because our money system is based on debt, it has a growth imperative baked into it. In other words, our money system is heating up the planet.
Once we realise this, the solution comes into view: we need banks to keep a bigger fraction of reserves behind the loans they make. This would go a long way toward diminishing the amount of debt sloshing around in our economy, helping reduce the pressure for economic growth.
- QUOTE: So where does all that additional money come from? Banks create it out of thin air when they make loans – they loan it into existence. This accounts for about 90% of the money circulating in our economy right now. It’s not created by the government, as most people assume: it is created by commercial banks in the form of loans. In other words, almost every dollar that passes through our hands represents somebody’s debt. And every dollar of debt has to be paid back with interest. Because our money system is based on debt, it has a growth imperative baked into it. In other words, our money system is heating up the planet.
2015
- http://quora.com/What-are-the-advantages-of-a-debt-based-currency-system
- … Either way this usury system represents a massive and continuous shift of real wealth from the borrowing classes to the lending classes. …