How can a bank “create money out of thin air”? We must enter the magical kingdom of “fractional-reserve banking,” where deposits are turned into loans, loans are turned into money, and so on, to find out.
With each iteration of the banking crisis, the Federal Reserve System and federal regulators gain in power and authority. Maybe the banking crisis isn’t an accident.
The usual suspects are "relieved" that Congress gave President Biden what he wanted on the so-called budget deal. Without sound money, however, the borrowing and spending regime will collapse sooner or later.
As the Fed increases interest rates to reverse the inflation it has caused, firms that depended on easy money will face the bankruptcy judge. Stay tuned; there's more to come.
Despite all of the inflation-fighting talk from the Fed, the truth is that the government benefits from inflating the currency. We need to know how to defend ourselves.
As government regularly intervenes in economic and financial markets, both continue to deteriorate. We must understand the kind of damage government causes.
