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Author Topic: How could government still have a grasp on fractional reserve banking?  (Read 742 times)
Anonymous
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June 22, 2011, 08:30:04 PM
 #1

So, genjix just released this on /. :

Quote
It's long known that economic growth is severely stunted without some measure of inflation. Adopting bitcoins for the global economy would mean that policymakers lose control on money supply, and while there are advantages in this, disadvantages far outweigh them. Additionally, adopting a global currency standard will deny governments ability to influence currency rates robbing them of yet another way to control the economy. Is there any plan to solve this? Maybe a system of independent bitcoin 'roots' operated by governments would help?

Genjix: Ben Friedman has released a lot of work on E money and how it will affect the future and how governments will adapt. The truth is that the government will still have monopolies on much of the operations of the economy such as fractional reserve banking and the issuing of licenses which allow banks to lend money.


If people choose to not keep their wealth and labor in centrally-controlled currencies, how could government possibly have a monopoly on parts of the economy including lending and... licenses?? How will licenses be even relevant if the government can't even gather taxes for its means of force?

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June 25, 2011, 11:48:09 PM
 #2

So, genjix just released this on /. :

Quote
It's long known that economic growth is severely stunted without some measure of inflation. Adopting bitcoins for the global economy would mean that policymakers lose control on money supply, and while there are advantages in this, disadvantages far outweigh them. Additionally, adopting a global currency standard will deny governments ability to influence currency rates robbing them of yet another way to control the economy. Is there any plan to solve this? Maybe a system of independent bitcoin 'roots' operated by governments would help?

Genjix: Ben Friedman has released a lot of work on E money and how it will affect the future and how governments will adapt. The truth is that the government will still have monopolies on much of the operations of the economy such as fractional reserve banking and the issuing of licenses which allow banks to lend money.


If people choose to not keep their wealth and labor in centrally-controlled currencies, how could government possibly have a monopoly on parts of the economy including lending and... licenses?? How will licenses be even relevant if the government can't even gather taxes for its means of force?



I think the point is that there are many ways to extract resources from people without actually taxing the currency via inflation or taxing currency transactions.  If the government has guns & legitimacy, and the people have resources/goods/services/labor, then the government people will find a way to get stuff out of the people.  Case in point: using bitcoin does not protect you in anyway from getting drafted or having to pay property tax on your house.  Also, they can enforce all sorts of their licensure laws to extract fines out of you for your agorist business failing to comply.

"We will not find a solution to political problems in cryptography, but we can win a major battle in the arms race and gain a new territory of freedom for several years.

Governments are good at cutting off the heads of a centrally controlled networks, but pure P2P networks are holding their own."
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June 26, 2011, 12:58:53 AM
 #3

  Case in point: using bitcoin does not protect you in anyway from getting drafted or having to pay property tax on your house.  Also, they can enforce all sorts of their licensure laws to extract fines out of you for your agorist business failing to comply.

It sure the hell does! It's difficult to run to Canada with your life savings hidden in your underwear.  And commonly the underwater "homeowner" doesn't even have to pay the MORTGAGE on his house! I've actually read of cases where the bank pays the taxes because they don't want to write off the loan, even with no payments for years!

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June 26, 2011, 01:06:57 AM
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  Case in point: using bitcoin does not protect you in anyway from getting drafted or having to pay property tax on your house.  Also, they can enforce all sorts of their licensure laws to extract fines out of you for your agorist business failing to comply.

It sure the hell does! It's difficult to run to Canada with your life savings hidden in your underwear. 

Good point! But still try getting over the border during draft time...im sure it would be difficult either way.  So not "protect", but I guess you could say bitcoin "facilitates" draft evasion.

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And commonly the underwater "homeowner" doesn't even have to pay the MORTGAGE on his house! I've actually read of cases where the bank pays the taxes because they don't want to write off the loan, even with no payments for years!

Hmm, interesting.  I wasn't aware of that.

"We will not find a solution to political problems in cryptography, but we can win a major battle in the arms race and gain a new territory of freedom for several years.

Governments are good at cutting off the heads of a centrally controlled networks, but pure P2P networks are holding their own."
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