Money and Banking

Scratching beneath the surface of the debate around countercyclical capital buffers, we find the normal level of duplicity that characterizes most debates about monetary policy.

Selgin thinks fractional reserve banking critics are akin to "flat-earthers", but he gets some important points wrong. 

It is impossible to force the economic development of society by artificially encouraging investment and initially financing it with credit expansion.  This policy can only have benefits if economic actors also elect to begin saving more at the same time.

Since the government is not a wealth generating entity, how can an increase in government outlays revive the economy?