‘Tis the season to be jolly? For many, the answer is “What? Are you kidding?” Christmas conjures up images of desperation shopping, crowds, hurriedness, nerves (did I get everyone something? Was it appropriate?). Not to mention the thought of receiving presents for which a polite response requires an effort of superhuman self-control. This obsessive-compulsive gift-giving……Continue Reading “A Christmas Meditation”

In the system we have now, we do use both a reserve restriction and an asset restriction. But, the modern reserve restriction has changed fundamentally, and has nothing to do with the monetarist understanding of reserve restrictions, except in a purely formal sense. In the day of specie convertibility, reserve restriction had a definite functionality….Continue Reading “Fact and Fiction on Reserve Requirements”

In a comment posted under an article by my friend Jerry Bowyer (Where’s the Hyperinflation?), “ps61penn62prin64” writes that “private currency monetary systems… are doomed to fail the interest of American citizens.” Bowyer’s article discusses the sizeable increase in the money supply generated by the Fed, and how this has — or has not — affected…Continue Reading “Private Issue of Money — the Root of Our Monetary Problem?”

This blog entry is for anyone who believes, as John Tamny here puts it, that “Fractional reserve banking quite simple IS.” Among the many good points Tamny makes in his article, there is the underlying assumption that our system is, in some important sense, a fractional-reserve system. But is this a valid contention? My contention…Continue Reading “Why We Do NOT Have a Fractional-Reserve System”

In his excellent book The New Lombard Street, Perry Mehrling writes of “a world that never was … Jimmy Stewart banking of blessed memory” (p. 117). This is an obvious  reference to one of Jimmy Stewart’s most famous roles: George Bailey in the holiday classic movie It’s a Wonderful Life. In the movie, Bailey is…Continue Reading “Jimmy Stewart Banking versus James Steuart Banking”