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[quote user="Knight_of_BAAWA"]Praxeologically show that. [/quote] I'm just speaking from my own experience. [quote user="Knight_of_BAAWA"]Constantly?[/quote] At regular intervals, that come around more frequently than I would wish. [quote user="Knight_of_BAAWA"]Isn't that called "budgeting"?[/quote] Sure
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[quote user="Angurse"] [quote user="mickanomics"]With a fixed reserve ratio and fixed total reserves, the total money supply will still become much larger than the monetary base as people borrow.[/quote] Stop... How? If both are fixed, the money will just come back into the system (as borrowers really only spend money) the total
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[quote user="Angurse"]How is that a problem, the money came back to the system? Couple a fixed reserve ratio with fixed total reserves and monetary expansion doesn't happen.[/quote] With a fixed reserve ratio and fixed total reserves, the total money supply will still become much larger than the monetary base as people borrow. And if a
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[quote user="Wanderer"]Mildly changing subject here, one simple thing that could be done is to increase the reserve requirement by a lot. For instance, Suriname has the highest modern-day reserve requirement (that I know of) at 35%. Hong Kong's is 18% and China's is 15.5%, and both countries (is it fair to call Hong Kong it's own
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[quote user="Smiling Dave"] 1. After a while, the red money would drop in value compared to the green money, because people would want money they can redeposit in a bank. After all, why settle for money that limits your options? By Gresham's law, all the green money would disappear. We would have only red money circulating. Is this what
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[quote user="David Sherin"]As long as both parties cannot access one pile of money at the same time, there shouldn't be inflation. If I put my money in a time deposit and I will have access to it in 3 months plus interest, for those 3 months the bank is free to do with that money as it pleases (most likely in some investment) so long as
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[quote user="Laser"]I'm not sure of the figures, but if you look at your central bank's money supply aggregates, you would find M0 - notes and coins - would be a small percentage of the broad money supply anyway. Somewhere around 2-5%.[/quote] In my system the monetary base could be composed of either cash (notes and coins) or electronic
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[quote user="Smiling Dave"]1. After a while, the red money would drop in value compared to the green money, because people would want money they can redeposit in a bank. After all, why settle for money that limits your options?[/quote] In my proposed system any kind of money can be deposited in a bank. But only red money can be loaned. But
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[quote user="David Sherin"]A time deposit should really be called a loan to the bank. Assuming you call it a time deposit, the depositor would have to know that he could not access the money for x amount of time. A demand deposit is supposed to keep full availability of the money in the deposit to the depositor and thus should never be used
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[quote user="Knight_of_BAAWA"] Why not simply have demand deposits and time deposits? [/quote] Well for one thing, they are a nuisance for the customer to maintain, having to constantly juggle money between the accounts and having to make a guess at how long they can do without spending their money. And secondly I'm not sure that it prevents