February 2023 - cypherpunks - lists.cpunks.org

OLD AGE, Pandemic and the anarchist movement
by professor rat 10 Feb '23

10 Feb '23

However, the silence of the anarchist militancy, its groups and organizations, in the face of the murder of thousands of elderly men and women neglected in their residences, victims of the infamous sanitary protocols and the gerontocidal strategy adopted by the different administrations to resolve the situation of stressed health resources, speaks clearly of how ageism has permeated our belief system, showing the insufficiency of our social analysis and evidencing the narrowness, not only of … [View More]

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Does "Dolphin Safe" Mean That No Dolphins Were Harmed? - Advertising, Marketing & Branding - United States
by Gunnar Larson 09 Feb '23

09 Feb '23

No St. Bernards were harmed in sending this message. https://www.mondaq.com/unitedstates/advertising-marketing--branding/1277014… The Dolphin Protection Consumer Information Act permits marketers of tuna to promote their products as "dolphin safe" if the tuna is harvested using methods that are not prohibited by the Act. For example, you can't claim that your tuna is "dolphin safe" if the tuna is caught through driftnet fishing. A consumer sued Costco, alleging that the company's claims … [View More]

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Another brick in the wall, Roger Waters sez democratic Ukraine polity ’ provoked ’ the KGB.
by professor rat 09 Feb '23

09 Feb '23

Very Assange ABC News More Invited to UN Security Council by Russia, Pink Floyd co-founder Roger Waters calls Ukraine invasion illegal, but not unprovoked 19 hours ago

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How Twitter bent over backward to accommodate Trump and his conservative allies.
by professor rat 09 Feb '23

09 Feb '23

The rot set in early under Jackass Dorsey https://www.thedailybeast.com/ex-twitter-officials-confirm-to-congress-that… Reposts not retweets that never meant anything anyway

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FTX Bankruptcy Lawyers Channel their Inner Sam Bankman-Fried – Bill $21,000 for their Meals Over Just 20 Days
by Gunnar Larson 09 Feb '23

09 Feb '23

https://wallstreetonparade.com/2023/02/ftx-bankruptcy-lawyers-channel-their… By Pam Martens and Russ Martens: February 9, 2023 ~ James L Bromley, Partner at Sullivan & Cromwell James L Bromley, Partner at Sullivan & Cromwell The shenanigans going on in Judge John Dorsey’s bankruptcy courtroom, which is overseeing the FTX bankruptcy proceedings of Sam Bankman-Fried’s collapsed crypto empire, are reaching levels that should be attracting the attention of federal prosecutors. The head … [View More]of the newly-created FTX Task Force, U.S. Attorney for the Southern District of New York, Damian Williams, has called the looted FTX customer accounts “one of the biggest financial frauds in American history.” On Monday, February 6, the lead counsel in the bankruptcy case, Sullivan & Cromwell, and its hand-picked CEO for FTX, John Ray, argued vehemently against the appointment of an independent examiner in the FTX matter. The independent examiner has been requested since December 1 by the U.S. Trustee, who works for the U.S. Department of Justice. Sullivan & Cromwell law partner, James Bromley, and Ray, cited the high cost likely to be charged by the independent examiner as one of their arguments against the appointment. The very next day, Tuesday, February 7, Sullivan & Cromwell submitted a compensation request for $7.6 million in legal fees for 19 days work in November, plus $105,000 in expenses. As part of those expenses, Sullivan & Cromwell included a request to be reimbursed for $7,202.19 for “Conference Room Dining,” and $1,840.00 for “overtime” meals. Accentuating the increasingly tone deaf nature of this law firm, just a few months ago Sam Bankman-Fried was making headlines for spending $2500 on lavish lunches for himself and staff while his customers’ accounts were being looted. Bromley, who was so concerned about the cost that might be incurred if an independent examiner was hired, billed at an hourly rate of $2,165 for a total of $381,689.50 in legal fees for the period of November 11 through November 30, 2022. Another Sullivan & Cromwell law partner, Andrew Dietderich, also billed at an hourly rate of $2,165 for a total of $465,042.00 over the same span of time. (Emails recently surfaced in another crypto bankruptcy case where Dietderich had written in an email to a different law firm on November 7 that FTX was “rock solid.” FTX halted customer withdrawals the next day and filed bankruptcy on November 11. See Bombshell Emails Raise Questions about What Sullivan & Cromwell Knew about Fraud at Sam Bankman-Fried’s Crypto Firms.) As lead counsel in the FTX bankruptcy matter, Sullivan & Cromwell is well aware that the bankruptcy estate is missing $8 billion of looted customer funds. What it bills is highly likely to reduce what the defrauded customers get paid. Sullivan & Cromwell’s $7.6 million in legal fees for 19 calendar days comes out to $400,000 per day. Annualized, that’s $146 million over the course of a year. The bankruptcy proceeding is expected to last as long as two years. Another compensation request filed on Tuesday was from a firm advising FTX on restructuring, Alvarez & Marsal. Its legal fees for 20 days in November came in at $5 million while expenses tallied to more than $180,000. Its FTX team devoured meals worth $12,324.88 for which it requested compensation. Another law firm that has been hired to work on the FTX bankruptcy, ostensibly to handle legal work that Sullivan & Cromwell is too deeply conflicted to handle, is Quinn Emanuel Urquhart & Sullivan. For a span of 51 days ending on December 31, 2022, it requested legal fees of $1.2 million and a little over $4300 in expenses. There was zero request for repayment for meals. Judge Dorsey did not rule on the request for an independent examiner on Monday, as had been expected. Instead, he called the lawyers, including the lawyer for the U.S. Trustee, into his chambers and, according to reports, told the lawyers to try to reach an agreement. Dorsey likely fears being overturned on appeal if he rules against the U.S. Trustee in one of the largest financial frauds in U.S. history. This could cast a decidedly negative light on the numerous times that this Delaware bankruptcy court’s judges (including Judge Dorsey) have ruled from the bench against appointing an independent examiner, despite legal precedent in published decisions and the clear statutory language. Another hearing in the FTX bankruptcy was scheduled for yesterday, when Dorsey was expected to announce how the independent examiner issue had been resolved. Instead, the hearing was abruptly cancelled. One item of business that was to be taken up at that hearing was the appointment of the law firm Young Conaway Stargatt & Taylor to serve as Co-Counsel to the Official Committee of Unsecured Creditors. Judge Dorsey signed that order yesterday appointing the firm, despite the cancellation of the hearing. (See Docket entry 657 at this link.) Judge Dorsey worked as a partner for that law firm for 16 years prior to taking his seat on the bench. Sullivan & Cromwell has come under withering criticism for serving as lead counsel in the bankruptcy despite voluminous conflicts of interest from its prior work for FTX, Sam Bankman-Fried and the hedge fund through which he allegedly looted the FTX customer accounts, Alameda Research. The recently surfaced email by Sullivan & Cromwell partner Andrew Dietderich, in the bankruptcy case of Voyager Digital, means that Dietderich could be called as a witness. Sullivan & Cromwell is also fighting a subpoena from law firms Boies Schiller Flexner and The Moskowitz Law Firm. The law firms want troves of documents and depositions from Sullivan & Cromwell over the work they did for FTX and Alameda in the Voyager Digital case. This is likely to mean that Sullivan & Cromwell will find itself in the problematic position of attempting to be both witness and advocate – which could potentially create unnecessarily delays and billings to the FTX bankruptcy estate. It’s not like Judge Dorsey wasn’t warned about this problem. In a letter sent to him on January 9, four sitting U.S. Senators – including bankruptcy law expert Elizabeth Warren – warned as follows: “To name just one challenge: will the firm’s lawyers be able to effectively investigate their current and former partners who were central in FTX’s conduct? Additionally, given their longstanding legal work for FTX, they may well bear a measure of responsibility for the damage wrecked on the company’s victims. Put bluntly, the firm is simply not in a position to uncover the information needed to ensure confidence in any investigation or findings.” An FTX customer, Warren Winter, also filed a formal objection to the appointment of Sullivan & Cromwell, telling the court: “Sullivan & Cromwell was one of the FTX Group’s ‘primary external law firms’ before the FTX Group collapsed. To date, the FTX Group has paid the firm more than $20.5 million in fees and retainers. Now, in the most flagrant attempt by a fox to guard a henhouse in recent memory, Sullivan & Cromwell has applied to be appointed the FTX Group’s bankruptcy counsel with duties that would include ‘investigating all potential estate causes of action’….” Despite the warnings, Judge Dorsey signed an order on January 20 making Sullivan & Cromwell lead counsel in the FTX bankruptcy. It’s time for disinfecting sunshine on what’s going on in this courthouse. We urge our colleagues at mainstream business media to wake from their slumbers and provide it. [View Less]

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Cryptocurrency: Dubai Bans All Crypto Privacy Coins, Your World Is Next, WarOnCrypto WarOnPrivacy
by grarpamp 09 Feb '23

09 Feb '23

These total hypocrites allow anonymous Gold and Cash. Every single time that you "wait for regulation" you will continue to get fucked because you didn't stand up for and demand your rights and Crypto Freedom. Stop Getting Fucked, Stop being such fucking sheep, and start fucking them instead. https://www.youtube.com/watch?v=xWAwK2fHArc No Regulators !!! Dubai Prohibits Privacy Coins Like Monero Under New Crypto Rules https://www.coindesk.com/policy/2023/02/08/dubai-prohibits-privacy-coins-… [View More]un… https://www.coindesk.com/policy/2023/02/07/dubai-mandates-licensing-for-cry… https://www.coindesk.com/markets/2018/05/29/japans-ban-is-a-wake-up-call-to… https://www.coindesk.com/policy/2022/11/15/privacy-enhancing-crypto-coins-c… https://www.coindesk.com/policy/2022/03/09/dubai-adopts-initial-crypto-law-… https://www.coindesk.com/policy/2022/11/09/dubai-presses-for-crypto-compani… https://old.reddit.com/r/Monero/comments/iti467/perkins_coie_whitepaper_ant… https://www.perkinscoie.com/en/news-insights/anti-money-laundering-regulati… https://www.quora.com/What-is-the-law-for-a-VPN-in-Dubai https://en.wikipedia.org/wiki/Human_rights_in_the_United_Arab_Emirates https://www.vara.ae/media/Virtual%20Assets%20and%20Related%20Activities%20R… https://www.dawateislami.net/magazine/en/evils-of-society/false-accusation The issuance of anonymity-enhancing crypto are banned under the Emirate's new regulations for digital assets. In Dubai, the issuance of, and all activities related to, anonymity-enhancing cryptocurrencies such as monero (XMR) are prohibited under new laws published Tuesday. The jurisdiction in the United Arab Emirates (UAE) published its long-awaited crypto regulations, which sets licensing and authorization requirements for virtual asset companies and issuers looking to operate in Dubai. The new rules define anonymity-enhancing crypto as "a type of Virtual Asset which prevents the tracing of transactions or record of ownership through distributed public ledgers and for which the [Virtual Asset Service Provider] has no mitigating technologies or mechanisms to allow traceability or identification of ownership." Regulators in other jurisdictions like Japan have also taken steps to prohibit privacy-enhancing crypto. The European Union is also considering prohibiting tokens that hinder traceability. "Any obfuscation of fund flows poses a challenge to detecting illicit activities, so it is unsurprising that regulators react strongly to these kinds of asset classes and mechanisms,” said Angela Ang, senior policy adviser at blockchain intelligence firm TRM Labs. Crypto activities in Dubai are supervised by its Virtual Assets Regulatory Authority (VARA), set up last year. The emirate has been working to attract attract crypto and blockchain companies to set up shop in Dubai. Read more: Dubai Mandates Licensing for Crypto Companies as It Sets Out Regulatory Requirements Update (Feb. 8, 10:33 UTC): Adds comment from Angela Ang. Correction (Feb. 8, 16:08 UTC): Removes mentions of Zcash from headline and first paragraph. It is unclear whether Zcash is affected because the regulator made exceptions for mitigating features, which theoretically could include Zcash's "unshielding" option. 58 comments share save hide report all 58 comments sorted by: best Want to add to the discussion? Post a comment! [–]Iamtutut 87 points 12 hours ago Money laundering city state bans a privacy coin, what a joke. Won’t prevent anyone to use or trade Monero. permalink embed save report reply [–]Ornery_Maintenance_8 41 points 11 hours ago Breaking News: Totalitarian regime bans tool that provides financial freedom to it's users ... I am so surprised xD permalink embed save report reply [–]SirArthurPT 19 points 11 hours ago Honestly, this is like passing a law against wind or rain... permalink embed save report reply [–]dEBRUYNE_1Moderator 13 points 11 hours ago The correction states: Correction (Feb. 8, 16:08 UTC): Removes mentions of Zcash from headline and first paragraph. It is unclear whether Zcash is affected because the regulator made exceptions for mitigating features, which theoretically could include Zcash's "unshielding" option. I don't see how that does not apply to Monero as well. Transactions can be verified with Monero's view key and key images. Additionally, see: https://www.reddit.com/r/Monero/comments/iti467/perkins_coie_whitepaper_ant… Which concluded: We conclude that privacy coins protect legitimate individual and commercial privacy interests and that existing financial regulations sufficiently address the AML issues that privacy coins present. And: Not only do privacy coins provide public benefits that substantially outweigh their risks, existing AML regulations properly and sufficiently cover those risks, providing a proven framework for combatting money laundering and related crimes. permalink embed save report reply [–]tripler142 36 points 13 hours ago How can you enforce this? Buy bitcoin on a legit platform, go to one of the p2p "desks" on the 🧅, trade for monero. 🤷‍♂️ permalink embed save report reply [–]notsetvin 47 points 12 hours ago Get caught and get your hand sliced off is how they will enforce this probably. permalink embed save parent report reply [–]tripler142 12 points 12 hours ago Lol, yeah they would do that.... permalink embed save parent report reply [–]EspHack 4 points 10 hours ago yeah, but also, hand slicing will scare business away survival of the fittest ensures we will end up with countries behaving more like hotels permalink embed save parent report reply [–]xmrjunkie223 2 points 9 hours ago You say that but I see these companies building and all encompassing approach to try and stomp this problems out. The cbdc trail in Nigeria and the fight against btc is really a fight against btc and xmr permalink embed save parent report reply [–]Elix_Exo1127 7 points 11 hours ago Like most laws this only hinders legitimate users, further pushing the narrative that Monero is just for criminals. Most users can't wrap their heads around anything more complex than ; "insert credit card here". permalink embed save parent report reply [–]BitsAndBobs304 2 points 8 hours ago they can take it off the CEXs, so you can't offramp anymore and you're locked in the tiny ecosystem of DEX and illegal vendors permalink embed save parent report reply [–]tripler142 4 points 8 hours ago You can swap bitcoin to monero via p2p. As long as it's legal to buy bitcoin is easy to buy monero. permalink embed save parent report reply [–]belsaurn 1 point 8 hours ago You can currently do that, what happens when there is so few that are willing to accept Monero because they have no way of off ramping it? permalink embed save parent report reply [–]ScoobaMonsta 3 points 3 hours ago Because the people who really understand Monero don’t want to cash out of Monero! Monero is not a vehicle for fiat profits! Monero is for using!!! permalink embed save parent report reply [–]BitsAndBobs304 0 points 8 hours ago you can't cash out, you're limited to the very small ecosystem of illegal merchants online and DEXes permalink embed save parent report reply [–]tripler142 6 points 8 hours ago You do the reverse. P2p to bitcoin, back to legitimate exchange cash out... not complicated permalink embed save parent report reply [–]BitsAndBobs304 2 points 7 hours ago you can't, because you'll get tainted btc that won't even be accepted on the CEX offramp or won't be able to show provenance or whatever else issue. permalink embed save parent report reply [–]tripler142 1 point 7 hours ago They would have to ban any cash to crypto transaction that you and I can just do together. The bitcoin is from that guy I met a year ago. Traded cash for his crypto.There. Provenance. permalink embed save parent report reply [–]BitsAndBobs304 3 points 7 hours ago With the taxman you're guilty until proven innocent. If the cash for coin guy gave you tainted or mixed coins they may get rejected. Also, not many people around the world trade cash for coin, and it's risky. permalink embed save parent report reply [–]tripler142 1 point 7 hours ago Tainted coins makes no fucking sense. Then cancel crypto I'll stick with cash. All the trained drug dealer, ponzi scheme cash is flowing and they accept it everywhere. That's like tracking every serial number of every bill ever minted. If they do that I'm out. If I buy it and then sell for a profit I pay taxes. Doesn't matter where it came from permalink embed save parent report reply [–]ScoobaMonsta 1 point 3 hours ago Open your eyes permalink embed save parent report reply [–]No_Industry9653 0 points 5 hours ago I don't think Dubai has the influence to take it off centralized exchanges. It will take a lot to eliminate every no-verification-required swap style exchange. Strangling Monero is possible but there is a high bar, you're going to need comprehensive monitoring of other chains and extensive controls over getting in or out of the "legitimate", fully surveilled and doxxed crypto ecosystem. permalink embed save parent report reply [–]BitsAndBobs304 2 points 5 hours ago they will force the exchanges to make a local version just like they do for european countries and for usa, one without monero. monero is not on any major usa exchange except kraken, even binance has monero but not binance us. EU keeps piling more and more crypto regulation, im sure theyll come for monero too eventually permalink embed save parent report reply [–]No_Industry9653 0 points 4 hours ago You can just use a VPN, forcing a local version doesn't do anything unless the exchange requires additional verification. What might make some difference is if they were pressured to cut off non-verifying smaller exchanges to prevent them from using the larger exchange to resolve liquidity issues, but that's not a showstopper either. permalink embed save parent report reply [–]BitsAndBobs304 2 points 4 hours ago You can just use a VPN, forcing a local version doesn't do anything unless the exchange requires additional verification they require KYC, so ofc you cant just use a vpn permalink embed save parent report reply [–]No_Industry9653 0 points 4 hours ago The largest ones do, but so what? Who uses those when they just want to swap between Bitcoin and XMR for privacy reasons anyway? Like I was saying, the loss condition is total surveillance and control of the visible coins and exchanges such that you can't get in or out, anything short of that doesn't cut it. permalink embed save parent report reply [–]BitsAndBobs304 2 points 4 hours ago what kind of minor CEXs allow you to cash out btc for usd/eur into your bank without kyc? permalink embed save parent report reply [–]No_Industry9653 1 point 4 hours ago None, but the big ones don't prohibit depositing coins that came from other exchanges. They would need to do this for effectively shutting down Monero use. permalink embed save parent report reply [–]beaubeautastic 1 point 7 hours ago gotta be careful though. that btc got your name on it, ln might be fine though permalink embed save parent report reply [–]psiconautasmart 1 point 7 hours ago Others work better than BTC for that. permalink embed save parent report reply [–]tripler142 0 points 7 hours ago Sure just an example, and most underground trading desks only use those 2 coins. Which I why I mention that in case people r into that sort of thing. I'm not. Informational purposes only permalink embed save parent report reply [–]FilmGunShops 8 points 11 hours ago Does this include gold and silver also known as privacy coins? permalink embed save report reply [–]ArticMineXMR Core Team 7 points 8 hours ago* Dubai also severely restricts, if not an outright bans VPNs. https://www.quora.com/What-is-the-law-for-a-VPN-in-Dubai So this is not that surprising. This is a country that does not have the independent judiciary or constitutional protections commonly taken for granted in the west. Edit 1: For the example legal arguments around preventing false accusations of criminal activity by blockchain surveillance companies, as a use case for Monero, which could be used in the EU, US etc., would likely not be possible in the UAE. Edit 2: https://en.wikipedia.org/wiki/Human_rights_in_the_United_Arab_Emirates Edit 3: Here is the official link to the actual regulations: https://www.vara.ae/media/Virtual%20Assets%20and%20Related%20Activities%20R… The key point is the definition of: Anonymity-Enhanced Cryptocurrencies means a type of Virtual Asset which prevents the tracing of transactions or record of ownership through distributed public ledgers and for which the VASP has no mitigating technologies or mechanisms to allow traceability or identification of ownership. There is a very strong case that a view key plus key images or even a cryptographic proof that a transaction was sent indicating who sent a transaction would meet the requirement above. Edit 4: The legal system in the UAE is based upon Shar’i Law. Here is some information on false accusations Shar’i Law: https://www.dawateislami.net/magazine/en/evils-of-society/false-accusation It comes down to making the case that blockchain surveillance (BS) is Haraam-e-Qat’ee because of the high probability of false positives. So while the western approach may not work in the UAE there are alternatives. permalink embed save report reply [–]GoXMR 17 points 13 hours ago Nobody changed the world by not going against the status quo. permalink embed save report reply [–]lDanceLikeThis 4 points 13 hours ago is this like a Grammy award? permalink embed save report reply [–]VeThor_Power 4 points 6 hours ago what baffles me is that we are in 2023 and still there is not a reliable DeX to trade Monero. It is ridiculous that this is not a priority for the community. permalink embed save report reply [–]Aotrx 3 points 5 hours ago UAE is modern day slave owning state permalink embed save report reply [–]_The-Resistance 10 points 12 hours ago I think they are referring to Monero on exchanges or KYC Monero, this will not affect individual wallets, cause enforcing this on non custodial wallets is impossible permalink embed save report reply [–]geonic_Monero Outreach Producer 11 points 11 hours ago There is no KYC Monero, stop with that bullshit term. permalink embed save parent report reply [–]_The-Resistance 3 points 11 hours ago If you buy on an exchange they will know you have it, not how you use it or where you use it, but they will have your identity linked to a Monero withdraw, and is worst if you don't withdraw and pay directly from your exchange account, that is why Local Monero exist permalink embed save parent report reply [–]geonic_Monero Outreach Producer 11 points 11 hours ago Right, so you've KYC'd yourself. The coin itself isn't KYC'd. If I send you 1 XMR right now, can you tell whether it's a "KYC Monero" or a regular Monero? permalink embed save parent report reply [–]_The-Resistance 2 points 11 hours ago That is right, what I am trying to say is that if you use an exchange you are fucked up permalink embed save parent report reply [–]geonic_Monero Outreach Producer 1 point 8 hours ago so a KYC monerozanto (monero user) permalink embed save parent report reply [–]LinuxHeki 3 points 13 hours ago WTF permalink embed save report reply [–]shortwavesurfer2009 2 points 6 hours ago Better tell localmonero and DEXes they cant do business their... Oh wait... permalink embed save report reply [–]Solid-Win6743 1 point 10 hours ago Uhhh, so scared, it is written on paper that it's forbiden, so now I can't use it. uhhhhh /s permalink embed save report reply [–]Ur_mothers_keeper 1 point 8 hours ago Is monero explicitly mentioned in this law? Because does have "mechanisms to allow traceability and identification of ownership." You can share individual transactionkey images with authorities, as well as view keys. It's just, the government needs due process or whatever it's process is (a car battery and jumper cables attached to the nuts in some countries) to compel the owner to divulge the necessary information. Maybe a citizen of UAE or a resident can clear that up for us? permalink embed save report reply [–]HoboHaxor 1 point 7 hours ago Didn't happen (mainly going by the droves people here that say you _can't_ ban Monero, thus it never happened.) permalink embed save report reply [–]beaubeautastic 1 point 7 hours ago "Any obfuscation of fund flows poses a challenge to detecting illicit activities, so it is unsurprising that regulators react strongly to these kinds of asset classes and mechanisms,” said Angela Ang, senior policy adviser at blockchain intelligence firm TRM Labs. damn right and we aint gonna stop permalink embed save report reply [–]Few-Calligrapher3617 1 point 4 hours ago Hell naw we gotta find a way to sneak in such technology without alerting Dubai they need monero permalink embed save report reply [–]PhillyFan1977 1 point 3 hours ago Keep buying and using it. permalink embed save report reply [–]ScoobaMonsta 1 point 3 hours ago The article on Japan is from 2018. It doesn’t ban Monero. It just forces the exchanges to delist privacy coins. It’s not illegal to own or to use Monero. permalink embed save report reply [–]Vikebeer 1 point 43 minutes ago Alphabet shills are pushing it a place to move to as well. permalink embed save report reply [–]dEBRUYNE_1Moderator 80 points 2 years ago* In sum: We conclude that privacy coins protect legitimate individual and commercial privacy interests and that existing financial regulations sufficiently address the AML issues that privacy coins present. And: Not only do privacy coins provide public benefits that substantially outweigh their risks, existing AML regulations properly and sufficiently cover those risks, providing a proven framework for combatting money laundering and related crimes. permalink embed save report reply [–]CaptainPatent 34 points 2 years ago Glad the attorneys at Perkins Coie have their heads on straight. Hopefully regulators agree. permalink embed save parent report reply [–]geonic_Monero Outreach Producer 22 points 2 years ago* Lawyers think whatever you pay them to think. I wouldn't take what they've written as a personally held opinion. Otherwise they would've written it without being commissioned by Tari Labs & Co (and it would've taken them less time, but, you know... they charge by the hour). Does anyone really think Perkins Coie would refuse to argue FOR the government (or any other institution) and AGAINST privacy-preserving cryptocurrencies, if they had approached them first? Because they believe in the technology? Please. permalink embed save parent report reply [–]CaptainPatent 14 points 2 years ago Lawyers think whatever you pay them to think. "No we don't" -The attorneys of Perkins Coie. This message has been paid for by a grant from the reddit antagonists fund permalink embed save parent report reply [–]geonic_Monero Outreach Producer 4 points 2 years ago 🤣 Exactly. permalink embed save parent report reply [–]SamsungGalaxyPlayerXMR Contributor[S] 23 points 2 years ago They still stand by their word. Perkins Coie is a well-known, prestigious law firm with their reputation on the line. They said everything in this whitepaper, not anyone else. permalink embed save parent report reply [–]geonic_Monero Outreach Producer 9 points 2 years ago Not arguing that. I'm saying that I can't judge their moral character by their professional output. Does anyone really think Perkins Coie would refuse to argue FOR the government (or any other institution) and AGAINST privacy-preserving cryptocurrencies, if they had approached them first? Because they believe in the technology? What do you think about this part? permalink embed save parent report reply [–]SamsungGalaxyPlayerXMR Contributor[S] 5 points 2 years ago I simply don't understand how that question is relevant. permalink embed save parent report reply [–]geonic_Monero Outreach Producer 12 points 2 years ago I was replying to someone who had said that the lawyers "have their head on straight". That implies a moral judgment. If they had refused to argue for the other side or had done the work pro bono, because they believe in the cause, I might be inclined to agree. permalink embed save parent report reply [–]Epidemic_Fancy 7 points 2 years ago Thank you; (and) yes this is a moment we all need to seriously appreciate and remember. We are here in a place of important historical remembrance where we prove our freedom is justifiably interwoven with truth and privacy as well as anti criminal pursuits. Beautifully written and now “peer” reviewed. Thank you to all who have made our wonderful and abstract journey possible. Have a beautiful day. permalink embed save parent report reply [–]PhillyFan1977 2 points 2 years ago Exactly 100% agree. There is no need for any further regulations permalink embed save parent report reply [–]jesuispero 18 points 2 years ago* Don't lose the forest for the trees. Did anyone even read the paper? Most of their suggestions, regarding Monero, if implemented by exchanges and payment service providers would mean a nightmare for everyone in this community except for those select few that are already well connected, have fancy lawyers and "optimal" legal structures. We as a community shouldn't condone or incentivize this type of discourse, even if it means financial "gains" in the short term. Most of their suggestions if put in practice would be a direct attack on Monero users, and yet here we are, celebrating. As /u/geonic_correctly pointed out this paper feels like a missed opportunity more than anything else. We as a community need to remain vigilant and not fall for the same traps that have plagued some other projects in this space, code can change, communities consensus can change, be mindful of playing the state apparatus game and hoping that somehow you'll "win" by playing by their rules. You'll lose, badly. Even if some people would be financially better off in the short term. That was never Monero's goal, keep that in mind. permalink embed save report reply [–]ErCiccioneXMR Contributor 12 points 2 years ago playing the state apparatus game and hoping that somehow you'll "win" by playing by their rules. You'll lose, badly. Get a moral gold medal. I'm happy to see there are still people in this community who refuse this kind of regulatory bullshit. I hate to see many acting like Monero will survive only if it will fit state regulations. Too many seem to see Monero as simply a product that needs to fit as many regulations as possible to become mainstream. I don't care of Monero becoming mainstream and worth 1 bajillion a coin. People who actually need Monero will never go through KYC or other regulatory bullshit. They will use an half-broken smartphone found in the streets of a city in Rwanda to send money to the rebels who are trying to overthrow the dictatorship. permalink embed save parent report reply [–]tempMonero123 5 points 2 years ago Monero can still be used outside of regulatory requirements, just like physical cash can. If Monero was made only to fit in such requirements (become neutered to the point it's basically Bitcoin), then I would have a problem with it. permalink embed save parent report reply [–]Alex058 3 points 2 years ago* How did this whitepaper change the community from cypherpunk to regulatory bootlickers? The tech hasnt changed, the people neither: chill man! EDIT: ErCiccione pointed out to me he didnt write anything like this, I must have read it elsewhere. Anyhow, my apologies to him EDIT2: I see I mixed up two replies, but that doesnt change the fact I was wrong 😅 permalink embed save parent report reply [–]ErCiccioneXMR Contributor 3 points 2 years ago How did this whitepaper change the community from cypherpunk to regulatory bootlickers? I never said any of that. You should probably reread my comments. permalink embed save parent report reply [–]Alex058 4 points 2 years ago Hi, I would have sworn I had read that exact words in one of your replies. But cant find it now, so I must have been mistaking, hence my well meant apalogies! I will edit my reply immediately permalink embed save parent report reply [–]jesuispero 4 points 2 years ago Also it's worth keeping in mind that loose community agreements shift, new people join the community, etc BTC community was mostly cypherpunk at some point, it's far from it these days, sometimes those things change fast. permalink embed save parent report reply [–]Alex058 3 points 2 years ago Agreed. Good thing is, if this community would change for the bad, a new one would arise permalink embed save parent report reply [–]rbrunner7XMR Contributor 3 points 2 years ago They will use an half-broken smartphone found in the streets of a city in Rwanda to send money to the rebels who are trying to overthrow the dictatorship. Woah, you lean pretty far out of the window here :) But yeah, has something. permalink embed save parent report reply [–]ErCiccioneXMR Contributor 6 points 2 years ago I could have made a softer example about rural asian communities receiving fundings for their farm in XMR directly to their phone from a random guy in australia, but the rwanda rebels thing was a more powerful example :P permalink embed save parent report reply [–]jesuispero 1 point 2 years ago I'm happy to see there are still people in this community who refuse this kind of regulatory bullshit. I hate to see many acting like Monero will survive only if it will fit state regulations. Too many seem to see Monero as simply a product that needs to fit as many regulations as possible to become mainstream. I don't care of Monero becoming mainstream and worth 1 bajillion a coin. I think we can close this thread now :) permalink embed save parent report reply [–]MoneroArbo 4 points 2 years ago Do you have any specific concerns? permalink embed save parent report reply [–]jesuispero 10 points 2 years ago* "To target and lessen the anonymity-related risks of privacy coins, appropriate enhanced due diligence would likely include measures to prove a customer’s source of funds, place of residence, and profession. Other measures may include a requirement that customers describe in detail their purpose for transacting privacy coins (e.g., the holder is a cryptocurrency trader or operates a business in which cryptocurrency is accepted as payment), along with anticipated privacy coin transaction volumes and anticipated privacy coin transaction counterparties." "Although it would be a blunter instrument for risk mitigation than per-customer analysis, a VASP could reasonably and effectively lessen the overall AML risk of a privacy coin offering by categorically prohibiting customers who are in higher risk categories or geographies from accessing the privacy coin offering" " a VASP could require supplemental information from a customer before processing a privacy coin transaction (e.g., details regarding the purpose of a transaction, the name and address of the recipient, and contact information for the recipient)." "Users can reveal an XMR transaction’s details that are specific to their account via key-based functionality that is built into the Monero protocol. Specific view keys can be shared with any third party to grant insight into the account associated with the view keys. This enables users and VASPs to disclose certain transaction details associated with a given account to a third party without publicly disclosing that user’s transactional information. In addition, VASPs can require up-front disclosures as part of their registration process and on an ongoing basis to meet their obligations." Imagine if all (or a combination of the above) becomes the standard of the industry, is this (as a community) what we are really rooting/lobbying for? permalink embed save parent report reply [–]tododiamesmacoisa 4 points 2 years ago Imagine if all (or a combination of the above) becomes the standard of the industry, is this (as a community) what we are really rooting/lobbying for? Eh, maybe. I mean, even if that becomes the industry standard... This community would develop alternatives, as some of them already exist. The goal of the paper was to prove that Monero can be completely aligned with KYC/AML practices and there's no need to ban it, which would be a lot, really a lot worse than just forcing KYC in the standard exchanges. permalink embed save parent report reply [–]jesuispero 2 points 2 years ago "Standard" exchanges that want to list Monero already do without (almost) none of the above measures. Coinbase doesn't list Monero because they don't want to, period. permalink embed save parent report reply [–]tododiamesmacoisa 6 points 2 years ago Cool. So I don't get your point. This whole whitepaper is literally just ammunition for when people or other entities come around spewing bullshit that they need to ban monero or something like that because it's impossible to apply the existing regulations to it. I prefer to have this ammunition than to not have it. permalink embed save parent report reply [–]jesuispero 2 points 2 years ago That the suggestions they make, if they were to become standard across the industry, would be a disaster for monero users. permalink embed save parent report reply [–]Alex058 2 points 2 years ago I disagree. This is allready standard practice with normal banks/fiat, as it is with buying crypto from VASPS’s with a bit higher volumes. I’d rather have XMR then USD, being sure there’s no unlimited printing AND I can buy stuff without companies knowing what and where I buy my groceries permalink embed save parent report reply [–]jesuispero 3 points 2 years ago Great that normal banks/fiat is the standard we hold ourselves up to these days. Regarding the rest, if your grocery store were to be using a payment processor they would potentially fall under some of this regulations, were they to follow some of this recommendations it's not necessarily true that "companies wouldn't know where you buy your groceries". Also, this paper clearly incentivizes entities to discriminate against "privacy coin" (blergh!) users to a degree of scrutiny that "other coin" users are not subject. That in of itself is concerning, it could also be used by current market participants (that deal with monero with no issues) to change their compliance policies to incorporate some of these suggestions. All in all, it's nothing to write home about, let alone celebrate. permalink embed save parent report reply [–]tempMonero123 1 point 2 years ago Yes, those are concerns, and I'd rather not have those requirements. However it doesn't stop Monero from being a useful tool. This would prevent people from not 'being their own bank'. People can still use Monero to transact and secure their wealth and pay for things without going through a bank or other financial institution. I don't like discrimination, and this could prevent someone like a cam performer from getting a crypto bank account (even though their services are legal, places like PayPal already refuse to have them as customers). This hypothetical cam performer may not be able to get a traditional mortgage, but they could still rent-to-own. I'm sure other products/services would pop up in the future that would allow for people to more safely 'be their own bank'. permalink embed save parent report reply [–]jesuispero 8 points 2 years ago* On another note, another high-level concern I have is that we as a community will change our culture and start focusing on these "compliance questions" too much, foregoing possible protocol improvements/research because that would potentially mean "delisting". Being not compliant with policies as draconian as the FAFT or AMLD5, would in other periods in this community, not that long ago, been seen as a badge of honor. Or that we'll become gradually more like the Bitcoin community, more and more focused on "number go up", "institutional investors" and similar crap like that. permalink embed save parent report reply [–]ErCiccioneXMR Contributor 6 points 2 years ago This is probably my biggest fear. Luckily that's not the case yet, but i cannot hide that seeing so many in the community being so focused about compliance (not talking about the average guy who only wants to see numbers going up, talking about actual contributors) worries me. Luckily i don't see key developers like moneromooo becoming regulatory bootlickers, so as long as things stay as they are, we are good. On a personal note, i wouldn't really want to be part of a project focused on pleasing institutions and regulations. That's not the reason i'm here. permalink embed save parent report reply [–]geonic_Monero Outreach Producer 31 points 2 years ago While I applaud the effort, it's disappointing that they decided to amplify the "privacy coin" meme. "Privacy-preserving" or "privacy-enabling cryptocurrencies" should've been used throughout. I would've also liked to see a section on "privacy-eroding cryptocurrencies", starting with Bitcoin, and how that affects the individual user. This was an opportunity to change the narrative around this technology and to underline how Bitcoin's radical transparency is the niche, not Monero's privacy-preserving technology. To explain to regulators and others that Bitcoin is unlike *any product* currently available in the financial world. Does any bank offer a transparent account that anyone can peer into? Why not? The paper also misses some of the more important benefits of fungible money. Guilt by association is a thing with Bitcoin. You need to not only be sure of the person you receive your Bitcoin from, but also be careful who you spend it with, since that person might commit a crime and you are the source of his funds. Bitcoin erodes freedoms on so many levels it is preposterous. permalink embed save report reply [+][deleted] 2 years ago* (1 child) [–]pcre 5 points 2 years ago Can I violate the money laundering law as a private person? Suppose I sell Monero on localmonero.co for cash. I cannot check whether the money comes from illegal transactions. I have to assume the innocence of the other person. The money laundering law turns this around. You have to prove your innocence. permalink embed save report reply [–]HoboHaxor 9 points 2 years ago Does it really matter? Cryptologists, mathematicians, scholars, security experts, all have testified before congress/senate stating the backdooring crypto just won't work. Yet the keep writing new bills and will until the anti encryption passes. permalink embed save report reply [–]Kukri4321 8 points 2 years ago Woo! Been waiting for this! permalink embed save report reply [–]Tallest-man 10 points 2 years ago At long last!! Thanks Perkins! permalink embed save report reply [–]johnfoss68 7 points 2 years ago Great work, and well done to all those involved in making it happen. permalink embed save report reply [–][deleted] 7 points 2 years ago Thank you team Tari permalink embed save report reply [–]endogenicXMR Contributor 5 points 2 years ago Great effort on this. I did notice the following references to auditing Monero exist in the paper... Specific view keys can be shared with any third party to grant insight into the account associated with the view keys. ... The confidential transactions feature is a cryptographic tool that allows for verification that no additional XMR has been created or destroyed as part of a given transaction, without revealing the exact transaction amount. 42 ... Unlike the Bitcoin protocol, Monero users have two sets of private keys and public keys (four keys total). The pair of public keys make up the wallet address of a Monero user, whereas the two private keys (the view key and spend key) allow an individual to determine whether an output is addressed to them (view key) and enables the individual to send XMR and determine whether it has been spent (spend key).43 To verify transfers of XMR, a third-party observer must know that the XMR is owned by the individual using it. To enable this verification, the individual using the XMR signs the previously received XMR with the one-time address used, thereby proving that the individual knows the private keys and therefore rightfully controls the XMR that the individual is using. The private view key may be given to others to grant transparency into certain details of particular transactions associated with the address or addresses. Monero also contains an optional text field called “tx_extra” that can store arbitrary data in encrypted format. While this text field can be used for a variety of compliance purposes, this use has not been widely recommended by researchers and developers.44 … which are great! But I personally would like to have seen a small section to show (via the Monero command-line system or a symbolic representation) some techniques, specific tools, and processes of exactly how legally liable entities or operators can, in PC's confidence, sufficiently comply, maybe with some basic examples for different entity types. How awesome that PC did this! permalink embed save report reply [–]fluffyponyzaXMR Core Team 9 points 2 years ago How awesome that PC did this! Just want to point out that they didn't do this of their own volition. Tari Labs commissioned it, and paid for it (with the help of some others). permalink embed save parent report reply [–]endogenicXMR Contributor 3 points 2 years ago Yes, I remember working on an original high level technical description of how Monero works during the MRL workshop which MyMonero and Tari sponsored and Naveen and I put on. We called it a one-sheet and it was requested for this 'regulatory writeup' work. Its on the MRL workshop minutes from back then, sarang, surae and I wrote it in Nashville, but was years before we saw what we became of it so I'm glad to see the post.. permalink embed save parent report reply [–]unjack 4 points 2 years ago I still don't see how it helps. permalink embed save report reply [–]Febos 20 points 2 years ago* It will help random new guy that heard of Monero and then heard FUD how not complaint Monero is with regulations and how will be delisted from all exchanges. It will help small exchanges or small merchants or any service that plan to use or use Monero and was uncertain because of the FUD. Now will normally continue doing what they were doing or start doing it with Monero. And they will point to the paper when people will ask about it. It will help you and me to explain to people, that FUD how Monero dont have future and how only surveillance coins will exist, is false. permalink embed save parent report reply [–]aaj094 8 points 2 years ago Well, for a while it has been a view that exchanges are hesitant to list monero because of regulatory concerns. This paper seems to allay fears that privacy coins are inherently incompatible with current regulatory regimes. permalink embed save parent report reply [–]TrasherDK 3 points 2 years ago Wrong reply. permalink embed save parent report reply [+][deleted] 2 years ago* (3 children) [+][deleted] 2 years ago (1 child) [–]TrasherDK 2 points 2 years ago Cool. Been waiting for this one forever. permalink embed save report reply [View Less]

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Cryptocurrency: Is Fighting Against WarOnCrypto De-Banking WarOnPrivacy GovBankPol and More
by grarpamp 09 Feb '23

09 Feb '23

Hilarious that the Millions of crypto users and hodlers around the world are not all 100% up the politicians asses in protest and support for crypto... instead these users all prefer to sit on their ass and watch all their crypto go to zero, all the while cedeing ever more of their Rights, Worth, and Human Freedom to the Tyranny of unneeded Politicians. Fight Back!!! https://cointelegraph.com/news/proposed-israeli-law-to-classify-crypto-as-s… Proposed laws in Israel that would see … [View More]

1 2

Cryptocurrency: Butters Debate Banks
by grarpamp 09 Feb '23

09 Feb '23

Just in case anybody forgot how our monetary system works to rob us, here it is from a reliable source plain as day. Investopedia: Do Banks Create Money? submitted 1 day ago by richmoney46 344 comments share save hide report all 344 comments sorted by: best Want to add to the discussion? Post a comment! [–]Shield4SI 256 points 1 day ago The creation of money via loans isn't the issue. It's actually an important part of our economy and allows for faster innovation. No … [View More]loans equals no mortgages, small business loans, or financing of things that we use every day. Once the loan gets paid back, the capital is destroyed The printing of money via governments to bail out failing companies, banks, and their own asses is the issue. permalink embed save report give award reply [–]HairyExcuse7927redditor for 7 weeks 61 points 1 day ago We went from not being able to fly, to putting boots on the moon in about 60 years while also financing two world wars all while on the gold standard dollar. permalink embed save parent report give award reply [+]Percyheckendorf -31 points 1 day ago* And then innovation slowed rapidly when we fucked the money up. The iPhone is essentially an iteration on 1950s-60s military science breakthroughs. permalink embed save parent report give award reply [–]godofpumpkins 19 points 1 day ago What? Computing has improved exponentially since then, the internet and tech has broadly revolutionized society? We invented cryptography to support it, which among many things enabled the development of Bitcoin. The amount of economic and societal growth since moving off the gold standard is mind boggling. I’m not going to claim there’s a causal link between the two, but it seems utterly indefensible to claim that the past half century hasn’t been absolutely revolutionary for all of humanity. permalink embed save parent report give award reply [+]Percyheckendorf -13 points 1 day ago* Improvement, iteration, not new breakthroughs. The cryptography, internet, and silicon breakthroughs are many decades old permalink embed save parent report give award reply [–]BastiatF -1 points 1 day ago To paraphrase Eric Weinstein and Peter Thiel, if you were put in a modern room but without the screens and computers, you wouldn't be able to tell whether we are in the 1960s or the 2020s. permalink embed save parent report give award reply [–]endfm 2 points 1 day ago Décor. permalink embed save parent report give award reply [–]Impressive_Editor185 2 points 1 day ago Stupidity permalink embed save parent report give award reply [–]Percyheckendorf -4 points 1 day ago* An iPhone is a lithium-ion powered silicon based computer with a touch screen, camera lense, speaker, and microphone, receiving wireless data transmissions and secured with cryptography. If it’s so dumb can you please point to the part of the iPhone that was a technological breakthrough discovered after 1976? permalink embed save parent report give award reply [–]Impressive_Editor185 1 point 14 hours ago* Go use a smart phone without internet which was invented in 1983 and not popular until late 90s network cards were around the same time aswell permalink embed save parent report give award reply [–]Percyheckendorf 1 point 12 hours ago* The DOD made the internet in the 1960s when they figured out how to make computers talk with each other. By the 1969 universities were sharing resources on ARPANET. 1973 ARPANET was international. TCP/IP is not when the internet was invented, is when they iterated to an accessible standard. Ethernet, 1974 Try again permalink embed save parent report give award reply [–]Impressive_Editor185 1 point 5 hours ago* U walk around with a computer to computer/Ethernet cable attached to ur phone? WiFi was invented and first released for consumers in 1997 when a committee called 802.11 was created then wireless Internet started rolling out commercially to the public in 1999 with the release of the apple airport permalink embed save parent report give award reply [–]Percyheckendorf 1 point 5 hours ago* Bro wireless data transfer has been around since the late 19th century. It’s wave decoding… radio OFMD used by wi-fi/bits/5G, 1966 Got another? permalink embed save parent report give award reply [–]Impressive_Editor185 1 point 5 hours ago Ur clearly miss understanding on purpose mobile broadband/cellular is 1991 aswell the things ur saying are completely different im clearly not talking about wave decoding permalink embed save parent report give award reply continue this thread [+]gumbopowder -20 points 1 day ago lol you think we landed on the moon in 1969 and can't rebuild the technology to do it again.. permalink embed save parent report give award reply [–]HairyExcuse7927redditor for 7 weeks 12 points 1 day ago Uh…no, I’m saying we went from not knowing how to fly to landing on the moon and people act like innovation was impossible on a gold standard dollar therefore we need fractional reserve banking and fiat currency… permalink embed save parent report give award reply [–]Melodic_Duck1406 2 points 1 day ago I got news for you bud, Bank loans back then were made up money too. There is a whole western movie about it and everything. permalink embed save parent report give award reply [–]iiJokerzace 34 points 1 day ago This is also implying 100% of all loans are repaid and no corruption is going on. permalink embed save parent report give award reply [–]antennawire 24 points 1 day ago Not only that, they can loan out 20x the underlying fiat amount. Fractional banking, it's usually only 5% they need to have as collateral. In the USA there's even no limit anymore: https://www.federalreserve.gov/monetarypolicy/reservereq.htm permalink embed save parent report give award reply [–]please_take_one 1 point 8 hours ago Reserve requirements have not been the limiting factor for a long time. The limiting factor is more just that you have to be a big bank and you have to not step too far out ahead of the “pack.” Imagine you are a smaller bank and you loan too much; the money starts in your accounts but will eventually flow to accounts held at other banks and you will have net outflow, and will go bust trying to settle with other banks. Or imagine you are a big bank but you loan way more than other banks your size. Same problem-- the net flow will statistically be biased towards flowing from customers holding accounts with you to customers holding accounts at other banks. So you will net negative and you eventually won’t be able to settle with competing banks. But now imagine you are one of the big banks, and you and all the other big banks gradually start ticking up how much you are lending, in relative lockstep with one another. Then the net flows between all of you will remain pretty equal and you won’t go bust. The banking sector as a whole then is driving a boom at this point, and profiting off of it of course. Then it goes bust and no one is held accountable and no one responsible has to forfeit any of the assets they picked up during the boom part of the cycle. Middle class and poor foot the bill. Boom/bust cycles are driven by banks and each time there is an asset transfer towards the big banks and the big players who sit at the table next to those elites. Governments or central banks quietly admit that this is how it works these days. And they claim that the banking sector is regulated somehow but we all know that is so flimsy as to be nonexistent. Here is the Bundesbank (Germany) admitting how money creation works on their youtube channel but they of course present it as totally harmless and well-regulated. https://www.youtube.com/watch?v=xHXRE3yKgWg permalink embed save parent report give award reply [–]ronoda12 39 points 1 day ago Not really. Banks creating repeated debt out of same money causes inflation and this is more than Fed printing new money. Also this leads to systemic risk when banks go towards zero reserve. permalink embed save parent report give award reply [+]poco -14 points 1 day ago The alternative is no loans. Not better. permalink embed save parent report give award reply [–]HappyCrusade 32 points 1 day ago Why is that so? Anyone with reserves/savings can loan their assets without creating them. Why does money need to be created to issue a loan, in your opinion? permalink embed save parent report give award reply [+]poco -18 points 1 day ago Why is that so? Anyone with reserves/savings can loan their assets without creating them. That's what banks do. Why does money need to be created to issue a loan, in your opinion? Money isn't created to issue a loan, issuing a loan is what causes the money multiplier because that loan becomes a credits somewhere else. I lend you $100, you lend $90 to Fred and Fred lend me $80. Now we have $270 in loans from only $100 of real money. Not magic, not created, just a feature of lending. permalink embed save parent report give award reply [–]CoolioMcCool 21 points 1 day ago You have $100, you lend me $90, now you have $10 and I have $90. No money created. The bank has $100, lends you $90, and they still have $100. Money created. permalink embed save parent report give award reply [+]poco -14 points 1 day ago The bank has $100, lends you $90, and they still have $100. Money created. That's not how it works. The bank has $100 and lends you $90, now they have $10 left. The money multiplier works because you either deposit that money into a bank or you use it to buy something and the seller deposits that money into a bank. Now all the banks have $190 deposited and $90 in loans. There is no way to lend money where this doesn't happen. permalink embed save parent report give award reply [–]AtheistMantis69 5 points 1 day ago I deposit 100$ to the bank, the bank takes those 100$ and lends you 100$. We both have 100$ in our accounts. permalink embed save parent report give award reply [–]DowvoteMeThenBitch 5 points 1 day ago But the bank only has a single $100 bill to back up $200 of accounts permalink embed save parent report give award reply [–]poco 2 points 1 day ago And $200 in their balance sheets. permalink embed save parent report give award reply [–]poco -2 points 1 day ago Yes, exactly. And you can't prevent that unless you ban loans permalink embed save parent report give award reply [–]Mintleaf007redditor for 3 months 1 point 23 hours ago you can have 100% reserve requirement and still have loans. permalink embed save parent report give award reply continue this thread [–]Zdendon 8 points 1 day ago You put 100 in bank, and bank will lend 800. (While still having your 100) They actually never lend out deposit money, they create new money instead. permalink embed save parent report give award reply [–]poco -1 points 1 day ago That's not how it works. Not unless you are a central bank that can print new money. The money multiplier works by people depositing borrowed money to get loaned out again. permalink embed save parent report give award reply [–]ItsShiva 16 points 1 day ago Please research the term fractional reserve banking and re evaluate your comment permalink embed save parent report give award reply [–]DowvoteMeThenBitch 11 points 1 day ago Fractional reserve banking is so clearly corrupt that it’s hard to get people to understand it’s legitimately magic money being printed. permalink embed save parent report give award reply [–]poco 3 points 1 day ago I just described it in my comment. Fractional reserve banking just means that some fraction of the deposits are reserved as cash. In my case I used 10%. You deposit $100 and they lend out $90. This isn't rocket surgery. I understand that this can have a multiplying effect over many loans such that the total deposits into the bank can exceed the actual cash. There is now $190 on the books. It isn't magic and my original point, that everyone is missing, is that this is a mathematical feature of any lending. If you have loans then this happens. If you don't want this to happen then you can't have any loans. permalink embed save parent report give award reply [–]ItsShiva 2 points 1 day ago You're right that you described it but you're wrong about the scale. It isn't that they have 100 in reserve and lend 90. Unless the 08 crash changed things, at that point (and likely still today) the ratio of reserve to debt as asset was something like 1 to 99. So when thats the case on scale of trillions, does that seem ok to you? Further as mentioned above what are the reserves? Cash in the form of...federal reserve NOTES. More debt instruments that are backed by what exactly? Nothing more than the faith of a government. Sure you can say that has value in so far as the government has a military and can force change through that. But the very idea that you create debt using old debt and pay it off using new debt creates only inflation. Fine, a constant inflationary environment can work well and in peace, but only so long as the distribution of these debt instruments (federal reserve notes) has some basis in EQUITY, and so long as the people have faith in their government. Look around you and ask your self is the distribution of federal reserve notes really based in equity and faith in the government or is it possible that bad actors have been skewing the distribution for themselves? permalink embed save parent report give award reply continue this thread [–]CoolioMcCool 1 point 1 day ago Idk if English is your second language or something but holy fuck "This isn't rocket surgery" had me laughing my ass off. Aaanyway, do you know what the required reserve ratio is currently for commercial banks in the USA? Pretty sure it is 0 now(as of 2020), and as the money multiplier can be calculated by 1/Reserve Ratio that allows effectively infinite loans. permalink embed save parent report give award reply continue this thread [–]DataFunctional4Troyredditor for 3 months 2 points 1 day ago Please research double-entry book keeping. One bank's assets are another bank's liabilities. permalink embed save parent report give award reply [–]PseudonymousPlatypusredditor for 3 weeks 3 points 1 day ago Yes but that’s not what’s being discussed here. permalink embed save parent report give award reply continue this thread [–]ItsShiva 1 point 1 day ago You're right one banks assets are another's liability. State and federal banks borrow money from the federal reserve bank before they make loans. So the monies the fed reserve lends are its assets and the monies loaned to the state and federal banks are their liabilities. But, then, where does the federal reserve get their assets from to lend out to state and federal banks? 🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔🤔 permalink embed save parent report give award reply continue this thread [–]DataFunctional4Troyredditor for 3 months 3 points 1 day ago I'm shocked you keep getting downvoted. Wth is happening to this sub. What you're describing is called double-entry book keeping. And the reason I guess you're getting so many votes is because it goes contrary to the sounds bouncing around in this echo chamber. permalink embed save parent report give award reply [–]tallreagan 1 point 21 hours ago Fractional reserve banking, that's why permalink embed save parent report give award reply [–]MadZane 2 points 1 day ago This actually isn’t how it works at all. Banks can lend many times the money they actually hold. It’s something like 10 times. permalink embed save parent report give award reply [–]poco 1 point 1 day ago No they can't, that's not how this works. That number you are thinking of is the money multiplier which is 1/reserve ratio. If your reserve ratio is 10% then the multiplier is 10. That doesn't mean that a bank can lend out 10x the money on deposit, it means that a bank can lend out 90% of the money on deposit, but if that loaned money is deposited back into the bank then they can loaned it out again. $100 deposited can become a $90 loan which can become a $90 deposit, which can become an $81 loan and then an $81 deposit. $100 + $90 + $81 +... ~= $1000 permalink embed save parent report give award reply [–][deleted] 1 day ago [deleted] [–]Morgothic 1 point 1 day ago And instead, they did away with them all together during covid. permalink embed save report give award reply [–]HearMeSpeakAsIWill 1 point 1 day ago* What you're describing is fractional reserve banking, and no, it is not the only way to lend money. The problem here is that the bank allows the original depositor to draw upon their $100, even after it has been loaned out. That's why money gets created in this scenario. Not because it's inherent in how loans work. If I lend you my car, for example, I no longer have a car to use myself. This is also how lending used to work in the days of gold and silver. When you deposit gold into a bank and it gets lent to Tom, you don't get to spend that gold until Tom repays his loan. You physically don't have access to it anymore. That system limits the ability of the economy to grow, but it doesn't prevent loans altogether. Renaissance-era banks realised they could get around this by issuing "promissory notes" in lieu of gold, which is where the money creation started. That's exactly what banks are doing now, except there's no distinction between the promissory note and the underlying asset. It's all just considered USD. permalink embed save parent report give award reply [–]poco 1 point 1 day ago Promissory notes make it easier to move large sums of value around without moving physical gold but, technically, fractional reserve lending could have worked with real gold too. They just didn't do it because of the hassle and they didn't think of it sooner. I deposit 100 gold coins in your bank. Fred needs 100 gold coins so you lend it to him for a fee. Fred pays my those coins for services rendered and I deposit them back in your bank. Now you have 200 gold coins on deposit and only 100 coins in the bank, but an IOU from Fred worth 100 coins. If I want to withdraw all my money you have to make me wait until you can in the loan from Fred who doesn't have enough, I complain to my friends, it and there is a run in your bank and you get hanged. Edit: And more specific to your example, you don't get to spend that gold until Tom repays his loan. The same thing happens with USD at a bank if everyone tried to withdraw their money all at once. It's called a bank run. permalink embed save parent report give award reply [–]Mintleaf007redditor for 3 months 1 point 23 hours ago They just didn't do it because of the hassle and they didn't think of it sooner. they knew all about it but countries that did this went bankrupt and were overthrown for corruption. permalink embed save parent report give award reply [–]ronoda12 0 points 1 day ago Nope. If they have 10 left that should reflect in your account. Not how it works. Stop spreading misinformation. permalink embed save parent report give award reply [–]richmoney46[S] 2 points 1 day ago No that’s what credit unions do, banks are different permalink embed save parent report give award reply [–]Professional-Tea2397 1 point 19 hours ago I appaud you for trying to explain how fractional reserve banking and the money multipler work, you are spot on of course. I've tried before in this sub but its an echo chamber of ignorance on this topic. I leave this comment so you don't lose faith in humanity permalink embed save parent report give award reply [–]Miz4r_ 1 point 1 day ago* In your example there is still only $100 in existence, but in the case of banks there actually is more money flowing around now in the economy. Until everyone asks for their money back, then you get a credit crunch like in 2008. permalink embed save parent report give award reply [–]poco 1 point 1 day ago Exactly. permalink embed save parent report give award reply [–]DataFunctional4Troyredditor for 3 months 0 points 1 day ago It's called double entry book keeping. One bank's assets are another bank's liabilities permalink embed save parent report give award reply [–]LetsPeee 14 points 1 day ago The alternative is accurately priced loans. If you take a risk, you should be prepared to fail. permalink embed save parent report give award reply [–]PseudonymousPlatypusredditor for 3 weeks 3 points 1 day ago No the alternative is loaning money that exists. Not loaning non-existent money. permalink embed save parent report give award reply [–]poco 1 point 1 day ago How do you lend money that doesn't allow for the money multiplier? If I lend you $100, what's stopping you from lending it out to someone else? permalink embed save parent report give award reply [–]Mintleaf007redditor for 3 months 1 point 23 hours ago nothing except the risk that you wont get paid back and still owe on your loan. permalink embed save parent report give award reply [–]poco 1 point 21 hours ago Yes, that's how loans work. And that's how money is multiplied by loans. permalink embed save parent report give award reply [–]ronoda12 1 point 1 day ago You seem to live in a binary world. permalink embed save parent report give award reply [–]poco 1 point 1 day ago How do you lend money and prevent the money from getting loaned out again? Seriously curious how you prevent the money multiplier while still allowing loans? permalink embed save parent report give award reply [–]ronoda12 1 point 1 day ago By curbing how much and how many times you can loan. permalink embed save parent report give award reply [–]poco 1 point 1 day ago How do you prevent me from lending money that I borrowed? permalink embed save parent report give award reply [–][deleted] 1 day ago [deleted] [–]poco 1 point 1 day ago Tell me how you loan someone money without the money multiplier coming into effect? permalink embed save report give award reply [–]bitsteiner 5 points 1 day ago Correct, it allows the economy to grow exponentially. The only problem is that civilization can't crow indefinitely in a limited world. If not stopped, it will destroy human habitat in a few hundred years. We need to change the monetary system to limit credit creation to a point that prevents exponential growth. permalink embed save parent report give award reply [–]Automaton9000 16 points 1 day ago No, the creation of money via loans is the issue. The Fed creates reserves which can be used by banks to create money which in turn is deposited and used to create more money. More money is created via loans than via the federal reserve's creation of new reserves. No one is saying get rid of loans, just have the damn capital to back them. permalink embed save parent report give award reply [–]DataFunctional4Troyredditor for 3 months 2 points 1 day ago More money is created via loans than via the federal reserve's creation of new reserves Can you provide a source? Money can also be created outside the US through double-entry book keeping. permalink embed save parent report give award reply [–]Automaton9000 4 points 1 day ago* Here is the total reserves of us banks: ~3T$ https://fred.stlouisfed.org/series/TOTRESNS Here is total outstanding US loans: ~12T$ https://www.ceicdata.com/en/indicator/united-states/total-loans But it's moreso knowing the accounting behind it all. Bank reserves aren't circulated as currency directly. They only contributed to inflation by giving the banks the ability to loan additional money when the reserves were printed (back when reserve requirements were 10%, today they are 0% so reserve balances technically have no impact on potential inflation levels since banks can loan any amount with any amount of reserve capital, even none). So at the end of the day it is mainly banks that inflate the currency supply, even though they are enabled by the FED and the financial system. Money can be created outside the US yes. In other currencies, not dollars. All that means is they can mess with the exchange rate of the dollar and their specific currency. permalink embed save parent report give award reply [–]DataFunctional4Troyredditor for 3 months 1 point 1 day ago Money can be created outside the US yes. In other currencies, not dollars I have a bridge to sell you then. US dollars can indeed be created outside the US using a ledger-based system among commercial banks. https://theunhedgedcapitalist.substack.com/p/how-the-eurodollar-system-work… permalink embed save parent report give award reply [–]mushambani 7 points 1 day ago Mmm as i see it the printing money issue its a consequence not the cause permalink embed save parent report give award reply [–]Ima_Wreckyou 3 points 1 day ago Credit money may have useful features in some cases, but left unchecked it leads to some serious degenerate gambling and debt bubbles. I think a fixed supply asset like Bitcoin is actually required to keep it in check. permalink embed save parent report give award reply [–]frankiefrank1e 2 points 4 hours ago Said it in more nice words than I had, but this is correct permalink embed save parent report give award reply [–]marcusmv3 2 points 1 day ago Yes, this is what allows us to grow faster than if we were on a gold standard being capped to the rate at which we can mine gold vs the amount of gold in existence. But let's talk about the reserve requirement going from 10% when we were kids to 0% now... permalink embed save parent report give award reply [–]Eggplant-Imaginary 5 points 1 day ago Reported god growth figures are half of what they were on the gold standard. Growth is restricted by the invention of new technologies that can produce more not print/creating money, otherwise Argentina would be booming. permalink embed save parent report give award reply [–]Eggplant-Imaginary 2 points 1 day ago GDP not god auto correct over powered permalink embed save parent report give award reply [–]marcusmv3 1 point 12 hours ago Just because current growth figures are lower than gold-standard-era figures does not negate my statement. When you operate a gold standard, your potential GDP growth is capped by the growth rate of your gold reserves. permalink embed save parent report give award reply [–]Ima_Wreckyou 3 points 1 day ago Even with the gold standard there where forms of credit money. The difference was it didn't pretend to be something other than credit money. permalink embed save parent report give award reply [–]Ken-The-Gent 4 points 1 day ago Well said! permalink embed save parent report give award reply [–]nutyourself 2 points 1 day ago The printing of money via governments to bail out failing companies, banks, and their own asses is the issue. Sounds like you know what you're talking about so let's be even more discerning. I would add: There's nothing wrong with government printing of money, it too is an important part of our economy, and if done right (see japan, MTT, etc..) it can really help grow the economy. The second part of your statement I do agree with, to some extend. Bailing out bad actors is questionable. In some cases, it's very true that if banks were allowed to fail in 08, it would've been catastrophic in a way most people can't fathom. In other cases, we should let the free market / capitalism play out and let some shit fail. IMO, if you get bailout in order to prevent a nation (or world) wide catastrophe.. you're done, your institution is now government owned. Banks that failed in 08 should've been made public. permalink embed save parent report give award reply [–]Impressive_Remote217 1 point 1 day ago Not really printing the money , only 2.2trillion in physical circulation, just adding digits to their digital ledgers . I'm personally hoping for a future society where money or crypto not needed. I think it's possible. Infrastructure work divided by population basically. permalink embed save parent report give award reply [–]Mintleaf007redditor for 3 months 0 points 23 hours ago There's nothing wrong with government printing of money lol. permalink embed save parent report give award reply [–]Umpire_State_Bldgredditor for 3 months 2 points 1 day ago Actually, in both cases such "money printing" is a form of theft, and you are one of the victims. permalink embed save parent report give award reply [–]Shield4SI 22 points 1 day ago No, it's not. I can take a loan and start up a BTC mining operation. Therefore, I've taken that loan and created something productive. As operations and "actual wealth" increases I pay back the loan, destroying the created capital. Same for a family that can't afford to buy a car outright. They take a small loan to buy a car. The car allows them to commute to a job, which allows them to be productive in society, creating wealth for the business, themselves, and the community. You stated in another comment, "No one can create actually wealth, eg, cars with loans." That statement is false. Take an easy example Elon has taken loans, created an entire satellite network, and kick-started the electric car industry. This will have far reaching affects in wealth generation for the entire world. I don't like banks anymore than most people, but a loan is simply borrowing from your own future since it needs to be repaid. Actual printing of money via government bodies is very different. permalink embed save parent report give award reply [–]nottobetakenesrsly 7 points 1 day ago Refreshing. Almost every sub (for or against Bitcoin), gets money as it currently exists... so terribly wrong. Not these comments though. As an aside, investopedia is ok, but gets a lot of stuff wrong too. permalink embed save parent report give award reply [–]confirmSuspicions 2 points 1 day ago Some yes, but the top comment says something wholly inaccurate. permalink embed save parent report give award reply [–]nottobetakenesrsly 5 points 1 day ago I'm speaking to that correction. Not the first post. permalink embed save parent report give award reply [–]broadmind314 1 point 15 hours ago* I don't expect to change your mind but hear me out. Banks lending out money also has an effect on the money supply and the value of currency in circulation. When a bank makes a loan, it creates new money by crediting the borrower's account with the loan amount. This increases the overall money supply and has the same inflationary effect as money printing by a central bank. In this way, bank lending can also be considered a form of indirect taxation or theft, as it reduces the value of currency for everyone else in the economy. The magnitude on how much this affects the general population will vary greatly based on the amount of reserves the bank is required to hold which is currently at 0%! https://www.federalreserve.gov/monetarypolicy/reservereq.htm Yes, I understand loans can support economic growth. However, this current unchecked growth is stealing from future generations and will inevitably end badly. It can and will continue to lead to never-ending inflation, which only benefits those whom spend it first. It's a game of musical chairs and we are all deaf. permalink embed save parent report give award reply [–]nottobetakenesrsly 2 points 12 hours ago Doesn't this ignore loan repayment as the destruction of money? When it comes to bank lending "permanently" increasing supply, then you need an ever increasing rate of new loan creation. The idea is there will always be a fluctuation degree of good transactions, and there should be a matching measurement at any given time (money). Bank lending supposedly being the mechanism by which an appropriate supply is determined. I'm completely ok with disagreeing with this approach... it's just how things are. I often think about how inelastic, and/or full reserve systems will function... ...whenever a monetary system fails to support transactions, a new system is usually created (almost invariably debt based). permalink embed save parent report give award reply [–]broadmind314 1 point 10 hours ago When a borrower repays a loan, the money is returned to the lender. The bank can then use that money to make new loans to other borrowers, invest in financial assets, etc. So the person who took the loan out still has whatever they purchased and the bank has the principal back plus interest so they can now lend it out again. It has only created money in this process. permalink embed save parent report give award reply [–]nottobetakenesrsly 2 points 8 hours ago the money is returned to the lender. When I issue a loan, it is created on the spot... I'm not using pre-existing dollars (I'm using balance sheet capacity). The loan comprises an asset line on a balance sheet. I need to offset that with a corresponding liability (could be the deposit if the proceeds are left in the same bank). If the rate of lending (more loans, more often) increases, the money supply increases (and the inverse is true as loans are paid back and/or rate of lending decreases... money supply decreases). permalink embed save parent report give award reply [–]broadmind314 1 point 7 hours ago Your reply is 100% correct. What I disagree with is the statement that money is destroyed in the process. permalink embed save parent report give award reply [–]nottobetakenesrsly 1 point 5 hours ago Perhaps it's just a difference in definitions of money.. (everybody has a different one)... and supply. I usually mean "usable units of exchange", loan repayment (the principal), takes units back out of circulation, and reduces both sides of the banks' balance sheet. Oversimplified example: $50k loan from bank to Bob. Bob had $0k, and now has $50k in his account. Bank has created an asset ($50k in debt), and has a corresponding liability ($50k deposit liability). Bob repays the loan with the same funds the next day. Both sides of the Bank's balance sheet are expunged. Bob's account goes back to $0, and the Bank no longer has a $50k asset, or a $50k liability. Now of course, there's a whole lot more complexity... interest earned, if the loan proceeds circulate through the economy... but at the end of the day, the same balance sheet mechanics are in play, and money mostly exists spread across many balance sheets. What matters is the rate of lending; if new loans aren't created, the supply truly does decrease. permalink embed save parent report give award reply [–]cryptosareagirlsbf 7 points 1 day ago Therefore, I've taken that loan and created something productive. What happens if you've taken that loan and NOT created something productive? What happens if enough people take loans and not create something productive? permalink embed save parent report give award reply [–]Shield4SI 1 point 1 day ago That's a personal problem not the loans fault permalink embed save parent report give award reply [–]cryptosareagirlsbf 3 points 1 day ago It's a personal problem if it happens with one person's loan. It's a bank problem if it happens with high enough number of loans. And bank problems, thus far, have been cured with QE. And that's worked out great. For some people, at least. permalink embed save parent report give award reply [–]broadmind314 0 points 1 day ago Try looking at it from another angle. Money printing can be seen as a form of indirect taxation or theft because it is hidden. It amounts to a transfer of wealth from holders of the currency to the central bank that printed the money. Those that receive the new money first are able to use it to buy goods and services before prices have adjusted to the new supply, which gives them an advantage over those who receive the money later. permalink embed save parent report give award reply [–]BastiatF 1 point 1 day ago No bank money creation != no loans permalink embed save parent report give award reply [–]skviki 1 point 1 day ago This won’t go through. It’s too abstract for some semi-religious crypto fans. They understand gold base, but not this. permalink embed save parent report give award reply [–]suuperfli 1 point 1 day ago loans are also part of the issue. big corps getting interest-free loans is also an unfair advantage, gaining via mass inflation theft ad infinitum permalink embed save parent report give award reply [–]HumbleBitcoinPleb 1 point 1 day ago I knew there was going to be a comment like this. And it's freaking UP VOTED? Are you guys serious? Is this really a bitcoin forum? How can ANYONE say money created by loans is not an issue? FFS. permalink embed save parent report give award reply [–]circleuranus 1 point 1 day ago It's actually not the bailouts that are the problem either. It's what those loans are used for. Loans that add value and economy in their local areas are the backbone of of prosperity. Loans that are used for mere rent seeking without providing value are the real problem. permalink embed save parent report give award reply [–]b0x3r_ 1 point 1 day ago Yes the money is destroyed when the loan is paid back, but the banks also issue new loans. The banks always have a balance sheet of outstanding loans which represents new money they created, which in turn devalues your currency. permalink embed save parent report give award reply [–]Javelinx65 1 point 18 hours ago About 92% of money gets created by banks via the lending process so banks creating currency is the issue with respect to inflation. Not allowing banks to create money via the lending process doesn't mean that their could not be mortgage loans or small business loans, it just means that you can't create the currency to do it. For instance, you could lend me money to buy a house or finance a business from savings and no new money would be created. Clearly, if you went to an equity based lending system, there would be a lot of unwinding to do in distorted asset prices. permalink embed save parent report give award reply [–]BuyRackTurk 1 point 13 hours ago The creation of money via loans isn't the issue It is 100% of the issue. It is the problem bitcoin is set to solve. and allows for faster innovation. It slows innovation and causes malinvestments. permalink embed save parent report give award reply [–]SupportUnit66 -1 points 1 day ago Governments don't create money, banks do it. When a government bail out a bank it increase it's public debt by issuing obligations, these obligations are acquired by the central bank that print money from thin air to buy them or to allow commercial banks to buy them. So the government is now in debt with banks because he bailed them out. And as soon as government is the representative of the people, we have been scammed. The same happens with loans, because a bank become the owner of a citizen debt without having initial money to loan. Citizens that prefers to save and don't contract debt are scammed because they see prices going up and therefore theirs savings losing value. Luckily Bitcoin fixes this and virtuous hard worker and savers have a way out from the banking system! permalink embed save parent report give award reply [–]Shield4SI 2 points 1 day ago Your covid stimi checks were from the fed who expanded the money in the system at the push of a button (aka printing money). It wasn't the banks it was specifically the Federal Reserve who is in charge of managing the money supply and financial systems full stop. Yes, banks create money through loans and such financial vehicles. However, they are not capable of injecting trillions into the economy that is the fed. You said yourself the central banks, which is the fed, prints money out of thin air. permalink embed save parent report give award reply [–]jonnyd93 0 points 1 day ago Not necessarily true, banks make money on the interest of those loans. which, in turn, does increase money supply by increasing debt. Especially bc of fractional loaning, banks don't need to have the money on hand to loan out, so for them they can print free money to loan, then collect the profit of interest. permalink embed save parent report give award reply [–]mikhailsharon99 0 points 1 day ago Of course is an issue because it meant that inflation will always occur even at the basic level. And what is inflation? The creation of money. That's it. permalink embed save parent report give award reply [–]eyescream187 0 points 1 day ago Not sure if I agree. When I use a credit card and buy something for $10,000. I pay back over time. When the balance is paid off, I still have $10,000 credit line available. The bank is taking my payments, I don't think they're destroying any money. The bank is taking the money I pay them and loaning it out again. This link is to a song with intro and outro from zeitgeist: the movie. https://youtu.be/1scnky6_FXI permalink embed save parent report give award reply [–]asaltandbuttering 0 points 1 day ago The alternative is not "no loans". It's "not creating new money out of thin air when issuing a loan". You're presenting a false dichotomy. permalink embed save parent report give award reply [–]funkybeatz911 0 points 1 day ago What about the 150 years of American history before the Fed where we had loans on the gold standard and new money wasn't conjured out of thin air? No innovation then? What do you call the railroads? What do you call the industrial revolution? What about going from ravaged by the civil war to the world's leading economic power in 15 years? That was all without the creation of money via loans. What makes you think that capital is "destroyed" once tho loan is paid back? So the interest paid on that loan is "destroyed" too then, right? Please take a step back and examine how you've been led to believe this because the idea that creating new money through loans isn't an issue is utter brainwashing permalink embed save parent report give award reply [–]Shield4SI 1 point 1 day ago No, I won't, but thanks for the comment. Feel free to take your own step back from that shitty comment and examine yourself and what the quantity of life was like back then and who really built the railroads. Cool, you know about interest. No one loans for free. permalink embed save parent report give award reply [–]mushambani 31 points 1 day ago They dont create money, they create debt permalink embed save report give award reply [–]Exit-Velocity 27 points 1 day ago It does create money, on paper. Its called fractional reserve banking. For example, a bank is able to lend me a house worth $500,000 with only $50,000 held in reserve. It creates $450k of economic activity worth of money that doesnt really exist. More info - https://youtu.be/8xzINLykprA permalink embed save parent report give award reply [–]EffyewMoney 8 points 1 day ago There's no reserve requirement since March 2020. permalink embed save parent report give award reply [–]lehcarfugu 2 points 20 hours ago The bank can't literally print money They can lend your money out without backing it If my friend gives me 5 dollars, and then I loan 4 dollars to a different friend, I am doing fractional banking. Did I create money? No permalink embed save parent report give award reply [–][deleted] 18 hours ago [deleted] [–]lehcarfugu 1 point 18 hours ago I'm well aware of both concepts permalink embed save report give award reply [–]broadmind314 1 point 13 hours ago* Yes they can and no you didn't because your loan is not included in M1, which is the aggregation of money circulation in a nation's economy. M1 = cash in circulation + bank deposits When a bank makes a loan, it credits the borrower's account with the loan amount, effectively adding to the M1 money supply. permalink embed save parent report give award reply [–]lehcarfugu 1 point 12 hours ago m1 money supply is not "creating money", as we have just demonstrated it is a flawed metric permalink embed save parent report give award reply [–]broadmind314 1 point 11 hours ago It may have its limitations, but it's not a flawed metric in the example you gave. M1 is directly related to the creation of new money in the economy via the money multiplier effect. permalink embed save parent report give award reply [–]lehcarfugu 1 point 11 hours ago you are arguing semantics permalink embed save parent report give award reply [–]broadmind314 1 point 10 hours ago I'm not interpreting it any further than the definitions state. permalink embed save parent report give award reply [–]vwite 14 points 1 day ago This. Only the federal reserves creates, a.k.a "prints" new money permalink embed save parent report give award reply [–]broadmind314 1 point 11 hours ago This is incorrect, unless you mean physically printing bank notes. Please read "Fractional Reserve Banking Process". https://www.investopedia.com/terms/f/fractionalreservebanking.asp permalink embed save parent report give award reply [–]vwite 1 point 11 hours ago so as the original commenter said, they create debt, not new money permalink embed save parent report give award reply [–]broadmind314 1 point 11 hours ago The debt itself is not considered money. However, through fractional reserve banking, the bank can use the borrowed debt as a basis to create new money. The bank records the loan as a deposit in the borrower's account, and this deposit can then be used as collateral to issue new loans to other customers. In this way, the original borrowed debt can be leveraged to create new money in the form of additional loans and deposits. permalink embed save parent report give award reply [–]vwite 1 point 11 hours ago so debts can be leveraged to create even more debt, not more money, just like GUH guy (/u/ControlTheNarrative) created more margin with the infinite margin loop, that does not mean he was creating money, just more debt permalink embed save parent report give award reply [–]broadmind314 1 point 11 hours ago Do these loans buy real goods and services? If the answer is yes, then the money supply is being increased by this process. permalink embed save parent report give award reply [–]vwite 1 point 11 hours ago GUH guy could also buy more assets (Apple stock), doesn't mean he can "print" trillions to buy the whole company permalink embed save parent report give award reply [–]broadmind314 1 point 10 hours ago I don't know what you mean when you say GUH guy (I clicked on the linked username and got an error). Theoretically, banks can infinitely increase the money supply though fractional reserve banking at a 0% reserve requirement. They are ultimately limited by the market demand for loans and capital requirements set by regulators. permalink embed save parent report give award reply [–]Cautious-Bobbylee 2 points 1 day ago Hello how do u think money is made. It’s created and then dented thru t bills. And also frantional reserve banking which creates the money multiplier effect permalink embed save parent report give award reply [–]Odd_Party 1 point 1 day ago Thanks, or I woulda had to post this myself. permalink embed save parent report give award reply [–]SlapHappyRodriguez 6 points 1 day ago This is talking about fractional reserve banking; not just printing money. permalink embed save report give award reply [–]cndvcndv 5 points 1 day ago Some objections to some top comments: "Money is destroyed when the loan is paid back." Although this is right, the issue is the delay and the continuity. When people keep getting loans to pay back in a few years, at any point in time, the money supply is artificially inflated. The fact that the loans are paid back is only relevant in the sense that the effects of loans can be reverted in a few years if banks no longer give loans. Another argument is "It enables innıvation and growth." I agree that people with good ideas should be allowed to create businesses without having to save money for decades. That doesn't mean the loan they get should be created from thin air. Wealthy people can lend their money for risk-free interest or directly invest in innovative businesses. When money supply is inflated just to incentivize people to innovate, as a side effect, people can't hold money to save a portion of their wealth without losing value. Therefore it disincentivizes saving and makes it more difficult and risky to have emergency funds. Even if creating money from thin air had a positive effect on the society overall, it's still ethically questionable to steal from people through inflation. permalink embed save report give award reply [–]HumbleBitcoinPleb 2 points 10 hours ago THANK YOU! Why is this so hard to understand? People defending the nonsense of money creation through loans will end up buying bitcoin at the price they deserve: 10 million or more. permalink embed save parent report give award reply [–]please_take_one 2 points 7 hours ago The fact that the loans are paid back Many loans are never paid back. Unpaid debt gets bought by central banks during bailouts, and sits eternally on the central bank balance sheet, never to be paid off, and merely sitting there as a statistic-- a slice of the ever increasing national debt. permalink embed save parent report give award reply [–]Ur_mothers_keeper 22 points 1 day ago This simplification is misleading. If you loan me 40 bucks, you've just created 40 bucks. You've got a $40 asset that is my debt to you, and I've got a $40 liability to you and $40 bucks in my pocket. Until I pay you back, this appears in the economy as an additional $40. There's no way around this, anyone can create debt with anyone else, it cannot be stopped, and fractional reserve isn't the source of this dynamic. It is the cause of debt cycles in the economy. permalink embed save report give award reply [–]BastiatF 3 points 1 day ago The difference is that, unlike for banks, your IOUs don't function as money. We can't exchange your IOUs for goods and services. permalink embed save parent report give award reply [–]please_take_one 1 point 8 hours ago Exactly. Banks literally just increment a number in their database when they give a loan. They don’t decrement any “reserve” account anywhere. (This is empirically proven, see the work of economist Richard Werner) It’s only because we all play along with the illusion that bank-created book money (which is simply magically created IOUs) is accepted as “money.” To make it yet more farcical: Book-money (dollar signs in bank accounts) aka Giralgeld is NOT legal tender, but everyone just accepts it In most countries you CANNOT pay your taxes with cash, which is the only legal tender. You can only pay your taxes with book-money which is the electronic magic money created by private banks, and is not recognized by the state collecting said taxes as being legal tender! It is actually a legal gray area that is in no country in the world actually spelled out explicitly. This collecting of taxes in book-money is obviously a very strong tacit approval, but it is nowhere spelled out in law what any of this really means or how it ought to be. It is simply a gray area system/convention. Banks are not given this power to create book-money by law, nor is it forbidden. Then one has to wonder-- If it is not legally spelled out, why can’t one of us individuals just start creating book-money the way banks do? And the answer is really just that it’s a club, and you’re not in it. And if you want to get into the club, you will start at the bottom with some tiny-ass community bank that will never compete with the bigger players in any way. Effectively society is divided between two classes: those who have the power to create money, and those who don’t. And this division is not in any way democratically legitimized. Democracy and rule of law are therefore patently fake. permalink embed save parent report give award reply [–]Ur_mothers_keeper 0 points 1 day ago That's not strictly true. This debt to you counts as part of your net worth, so when the amount of money in circulation is assessed, your illiquid IOU still counts as well as the 40 bucks your friend put in circulation. You can get loans against your net worth. permalink embed save parent report give award reply [–]BastiatF 2 points 21 hours ago When you make a loan, M2 doesn't increase. When banks make loans, it does. What you are talking about is using your IOUs as collateral. It's irrelevant because it doesn't increase money supply. permalink embed save parent report give award reply [–]Ur_mothers_keeper 0 points 18 hours ago Absolutely it does when you make loans. permalink embed save parent report give award reply [–]BastiatF 2 points 18 hours ago Absolutely not. Your IOUs aren't money. They are not part of M2. permalink embed save parent report give award reply [–]Ur_mothers_keeper 1 point 16 hours ago No, but when you measure the money in an economy, you're measuring net worth and circulating supply. When you loan out some money this shows up on the supply side of money (because money can be seen as another commodity, just that it is the unit of account) and it presents itself as price inflation. Just because your credit is illiquid doesn't mean that it has no effect, the credit side is illiquid but the debt is not, it is being spent by the borrower and has an inflationary effect. permalink embed save parent report give award reply [–]BastiatF 2 points 16 hours ago You are confusing wealth and money. There is a lot more wealth than money in existence. You should look at the definition of M0-3, "net worth" is absolutely not part of it. permalink embed save parent report give award reply [–]Ur_mothers_keeper 1 point 15 hours ago I am very clear on the distinction between wealth and money. Look dude, I'm not talking out of my ass, I'm trying to explain somethingthat is already well understood. I'm not defending fractional reserve, fiat or any of that. I'm just explaining the impact of private debt on the supply and demand dynamics of money. Private credit absolutely does have an inflationary impact on money supply, it is the cause of the short term debt cycle. permalink embed save parent report give award reply [–]BastiatF 2 points 13 hours ago Look dude, you were claiming that loans from non-bank entities create new money. I simply corrected that misconception. permalink embed save parent report give award reply [–]10yearsnoaccount 4 points 1 day ago But in that case I had 40 bucks to loan you. The bank only needs to have $4 yet you get $40 cash in your hand. That's a pretty fundamental difference.... permalink embed save parent report give award reply [–]Ur_mothers_keeper 4 points 1 day ago This is a large misunderstanding of fractional reserve that is untrue. The bank has 100k on deposit from depositors. It can loan out 90k of that, provided a 10% reserve requirement, not 1,000,000. Once you understand this common misconception all the rest will fall into place. permalink embed save parent report give award reply [–]Mintleaf007redditor for 3 months 1 point 23 hours ago thats not a common misconception... the people who deposited their money still have access to their funds. permalink embed save parent report give award reply [–]BastiatF 6 points 1 day ago Reserve requirements have been abolished in most advanced economies. So the bank needs $0 to loan you $40. permalink embed save parent report give award reply [–]perfectlyboiledegg -1 points 1 day ago No they haven’t lol permalink embed save parent report give award reply [–]BastiatF 0 points 1 day ago Yes they have lol. US, Canada, the UK, Australia, New Zealand, Sweden and Hong Kong. That's most of the advanced economies by GDP. Eurozone is now down to 1% and on it's way to 0. permalink embed save parent report give award reply [–]perfectlyboiledegg 2 points 1 day ago* A quick google search pulls up capital requirements in Hong Kong and Europe. What are you talking about? Here: https://www.hkma.gov.hk/eng/key-functions/banking/banking-legislation-polic… https://www.delphix.com/glossary/basel-iii#:~:text=Minimum%20Capital%20Requ…. https://www.osfi-bsif.gc.ca/Eng/fi-if/rg-ro/gdn-ort/gl-ld/Pages/CAR22_chpt1… https://www.fi.se/en/bank/Capital-requirements-for-swedish-banks/#:~:text=T…. permalink embed save parent report give award reply [–]BastiatF 2 points 1 day ago That's capital requirements, not reserve requirements 🤦‍♂️ Learn the difference: https://en.m.wikipedia.org/wiki/Reserve_requirement permalink embed save parent report give award reply [–]perfectlyboiledegg 1 point 1 day ago Ok but your comment implies banks don’t have to hold any cash when capital requirements clearly mean they are required to. permalink embed save parent report give award reply [–]BastiatF 1 point 20 hours ago They need to hold capital, not cash permalink embed save parent report give award reply [–]10yearsnoaccount 0 points 1 day ago Well then the original isn't misleading at all then.... bring on the next "worst crash in history how could anyone have seen this coming" event. permalink embed save parent report give award reply [–]bitsteiner 1 point 1 day ago anyone can create debt with anyone else, it cannot be stopped, This is not allowed by regulation. Only commercial banks members of a central bank can do that. It is their privilege. If a non-bank or a private would do that on a regular basis, it will get fined or even jail. Credit creation results in fractional or zero reserve. permalink embed save parent report give award reply [–]perfectlyboiledegg 1 point 1 day ago Any depository institution can borrow money from the fed. Also, literally anyone can loan money otherwise bitcoin and all of fintech would be illegal. The online “banks” that lend to consumers all just borrow money from commercial banks, and they are all losing money because they are not required to maintain capital allocations that a bank would. permalink embed save parent report give award reply [–]bitsteiner 1 point 1 day ago Sure you can make private loans of whatever currency to someone else, but you can't create credit out of collateral like fractional reserve banks do. permalink embed save parent report give award reply [–]perfectlyboiledegg 1 point 1 day ago What is this rocket lawyer service for then? Am I misunderstanding you? I have personally underwritten loans where I could see someone’s wealth included a loan from an individual. Also what do you mean by regular? How do you think angel investing works? https://www.rocketlawyer.com/family-and-personal/personal-finance/personal-…. permalink embed save parent report give award reply [–]bitsteiner 1 point 1 day ago Difference is that you can lend existing money against collateral, but you can't lend non-existing money against collateral like fractional reserve banks do. permalink embed save parent report give award reply [–]perfectlyboiledegg 1 point 1 day ago It’s weird that you’re arguing what makes money exist on a bitcoin sub. I could borrow money from the bank and then loan money, and the bank wouldn’t care or know unless I defaulted. permalink embed save parent report give award reply [–]bitsteiner 1 point 1 day ago Sure you can do that. When you borrow $100 from a bank and lend that $100 to someone else, you have $0 left - the money supply hasn't changed. If a Bank has $100 in deposits and makes a loan of $90, the deposit of $100 is still there plus a deposit of $90 was lent into existence - the money supply has increased from $100 to $190. That is the difference. permalink embed save parent report give award reply [–]perfectlyboiledegg 1 point 1 day ago Unless I make a business and sell equity, then I make a money out of a multiple of EBITDA. This is the same principal, but a bank would do it for a modest interest rate rather than a portion of ownership. permalink embed save parent report give award reply [–]bitsteiner 1 point 1 day ago If you sell, someone else buys and money changes hands. I don't see how that increases the money supply. permalink embed save parent report give award reply continue this thread [–]rabbitlion 1 point 1 day ago I'm fully allowed to take my $40 and lend it to someone else, thereby "creating money". permalink embed save parent report give award reply [–]bitsteiner 1 point 1 day ago Agreed, but that doesn't create money, since you give your money to someone else. The amount of money in the economy does not change. Only the central bank or commercial banks can increase the monetary aggregates. permalink embed save parent report give award reply [–]rabbitlion 1 point 1 day ago It's exactly how commercial banks create money. They don't have a magic button that summons money out of thin air, they just artificially inflate the money supply with fractional reserve banking. Only the central bank can truly create money. You can easily see this difference if you look at bitcoin where doing fractional reserve banking would inflate the money supply exactly the same way that banks do with US dollar. Since there's no central bank in bitcoin, you cannot truly print new ones (outside of mining), but you can expand the artificial supply. permalink embed save parent report give award reply [–]bitsteiner 1 point 1 day ago Yes, you can fractional reserve anything, but is fraud if non-banks do it. permalink embed save parent report give award reply [–]rabbitlion 1 point 1 day ago No, it's not. If I borrow $100 from Adam it's perfectly legal to lend $90 of those to Bill, only reserving a fraction of Adam's "deposit". It would even be legal for me to spend the $100 on booze and have nothing reserved at all. Now, if I want to start offering banking services to the general public on a larger scale and be able to borrow money directly from the fed, naturally I'd need some sort of license. permalink embed save parent report give award reply [–]bitsteiner 1 point 1 day ago That is not fractional reserve lending. After lending $90 you have $10 only left, you can't spend $100. permalink embed save parent report give award reply [–]rabbitlion 1 point 1 day ago That's exactly how it works for banks too though... permalink embed save parent report give award reply [–]Mintleaf007redditor for 3 months 2 points 23 hours ago lol imagine if banks couldnt create money. the ultra rich would be very poor very fast. permalink embed save parent report give award reply [–]bitsteiner 1 point 1 day ago Contrary to common belief and descriptions in text books, there is some good education on explaining how commercial banks create deposits: https://www.bankofengland.co.uk/-/media/boe/files/quarterly-bulletin/2014/m… permalink embed save parent report give award reply [–]HumbleBitcoinPleb 1 point 10 hours ago Dude. If you deposit $100 in the bank and the bank loans $90 to Michael, there is now $190 in the economy. You can spend $100 on Amazon and Michael can spend $90 on Walmart. The bank created $90 out of thin air. permalink embed save parent report give award reply [–]Ur_mothers_keeper 1 point 1 day ago It's illegal to loan your buddy 20 bucks? Think before talking man. And even if it were, people would still do it. it would still happen. permalink embed save parent report give award reply [–]bitsteiner 1 point 1 day ago Didn't say it was. permalink embed save parent report give award reply [–]Ur_mothers_keeper 1 point 1 day ago this is not allowed by regulation Are you hypoxic? permalink embed save parent report give award reply [–]bitsteiner 2 points 1 day ago* If you loan your buddy $20, you give him $20. Nothing gets created, your claim doesn't add to the money supply, it remains in a closet and is essentially worthless. permalink embed save parent report give award reply [–]SmoothGoing 27 points 1 day ago Loans are not for nothing. They pay for cars, and houses, and business expansion, etc. And loans need to be paid back. Paying back loans destroys money then. Everyone conveniently forgets that. permalink embed save report give award reply [–]Mintleaf007redditor for 3 months 2 points 23 hours ago it destroys the money at a later time. this is very different. if i had a trillion dollars today and had to pay it back a year from now i could make vast amounts of wealth. or if i lost it then the bank gets a bailout. permalink embed save parent report give award reply [–]Socialists-Suck 6 points 1 day ago Technically it’s not “money” it’s debt. Money needs to be tied to work i.e. production for it to be money. What we have here is a pyramid scheme. permalink embed save parent report give award reply [–]Bitcoin_Maximalistredditor for 3 months 2 points 1 day ago Loans are not for nothing. They pay for ... and houses https://en.wikipedia.org/wiki/Subprime_mortgage_crisis what a beautiful system permalink embed save parent report give award reply [–]SmoothGoing 1 point 1 day ago It's how they made money. Originate mortgage. Sell it. Pocket immediate $500 bucks or whatever. Incentive to ask for good credit worthiness is quite low. If they couldn't create a MBS and dump it on others they wouldn't issue mortgages to everyone with a pulse. Now also don't forget who lived in a house better than yours and which they knew they couldn't afford. "Those" consumers. The ones who took advantage of easy credit and then defaulted. Plenty of blame to go around but it's not the bank's fault deadbeats couldn't pay what they agreed to. permalink embed save parent report give award reply [–]please_take_one 1 point 8 hours ago Plenty of blame to go around but it's not the bank's fault deadbeats couldn't pay what they agreed to. But the bank created money in giving out that loan. Money is supposed to represent the economic value generation effort of the individual laborer. When banks recklessly devalue money, they are stealing from laborers who can only recoup the cost of their labor in said money. I don’t blame the bank necessarily. It’s just foolish of us to participate in this system. But I would get laughed at if I went to my HR/accounting department and asked to be paid in legal tender (cash) rather than book-money. Let alone to be paid in bitcoin. permalink embed save parent report give award reply [–]btc-beginner 1 point 20 hours ago That is nothing. The big bucks are made when big companies, buy other big companies. Usually with the type of super low to zero interest rates, that slowly to never gets paid back. Different rules for different players. Here is a great explanation : https://youtu.be/EC0G7pY4wRE permalink embed save parent report give award reply [+]confirmSuspicions -7 points 1 day ago It doesn't destroy it. If they didn't want it you wouldn't have to pay it back lol. Did you think your credit card company is just lighting your monthly payment on fire? Lmao. Even to give you the benefit of the doubt, the fed rolls assets off of its balance sheets, but bank of America or something isn't volunteering their assets to be burned. That's an insane misunderstanding. permalink embed save parent report give award reply [–]SmoothGoing 5 points 1 day ago If issuing loans creates money paying off loans destroys money. No it was not set on fire. But they didn't sit there with a crayon drawing $100 bills either to create it. permalink embed save parent report give award reply [–]edgestander 2 points 23 hours ago This is conversation is literally the most aggressively r/bitcoin discussion I’ve seen. You post the objective truth of how money creation/destruction works and get “called out” for misinformation. permalink embed save parent report give award reply [+]confirmSuspicions -9 points 1 day ago At a policy level you are nearing some technically correct levels of almost being right. But you're not right. Accept the correction gracefully. You're spreading misinformation. permalink embed save parent report give award reply [–]ertaisi 3 points 1 day ago Your correction was like 30 words and clearly didn't win them over. You've got some hubris declaring the debate concluded and arrogantly telling them to sit down and let you win. Your position is now weaker to most readers than when you started. You would have been better off just not responding again. permalink embed save parent report give award reply [–]SmoothGoing 1 point 1 day ago I'm ok with that. It's all just opinions of randoms on the webs. permalink embed save parent report give award reply [+]confirmSuspicions -6 points 1 day ago You're okay with being wrong as long as you got upvoted first. Great contribution to society. permalink embed save parent report give award reply [–]SmoothGoing 5 points 1 day ago https://www.google.com/search?q=paying+off+loans+destroys+money Accept the correction gracefully. You are digging yourself in a hole for no reason. permalink embed save parent report give award reply [–]confirmSuspicions -2 points 1 day ago Yup just act like you know what you're talking about so you can say you got something from your college education. permalink embed save parent report give award reply [–]SmoothGoing 5 points 1 day ago Downvote me then. I don't owe you anything. permalink embed save parent report give award reply [–]confirmSuspicions 1 point 1 day ago I don't use downvotes to emotionally punish someone I'm not a child. permalink embed save parent report give award reply [–]P_e_a_s_h_o_o_t_e_r 1 point 1 day ago You're completely wrong dude. Repaying the loans destroys the money, or rather the debt that is considered money. permalink embed save parent report give award reply [–]Sneudles 0 points 1 day ago And every loan is always repaid, especially the ones listed on the us national debt clock. permalink embed save parent report give award reply [–]P_e_a_s_h_o_o_t_e_r 1 point 1 day ago How is that relevant to the discussion whether paying back loans destroys money or not? Also, the government actually repays loans. They just issue new loans to cover repaying past loans. If they didn't repay loans they wouldn't be getting the best interest rates. permalink embed save parent report give award reply [–]Sneudles 1 point 1 day ago because it brought you to bring up the money created from interest too. permalink embed save parent report give award reply [–]Umpire_State_Bldgredditor for 3 months -1 points 1 day ago There is mere "money" and then there is "actual wealth". Nobody can create actual wealth (eg, "cars") by creating new "money" within the fractional reserve banking system. permalink embed save parent report give award reply [–]SmoothGoing 2 points 1 day ago Loans are backed by collateral borrowed against. Your landlord's bank owns the house you live in. You pay your landlord's mortgage. He gets actual wealth. You get a roof to stay under. permalink embed save parent report give award reply [–]Umpire_State_Bldgredditor for 3 months 2 points 1 day ago They can "print" all the money they want, but they cannot "print" any actual wealth. permalink embed save parent report give award reply [–]HighlySuccessful 1 point 1 day ago Not so simple. Example: Business gets a loan to expand it's businesses and pay employees, a guy buys a second house with a mortgage, and rents it for x2 of what he pays monthly for the mortgage. The employee rents that house for 10 years, but eventually his company goes bust. The person renting the house has accumulated wealth. permalink embed save parent report give award reply [–]life_is_enjoy 0 points 1 day ago I don’t have a lot of knowledge about this. My question is … so do banks gain interest on the money that never existed in the first place? Even when the money gets destroyed after the loan is paid back, the interest remains….? permalink embed save parent report give award reply [–]SmoothGoing 1 point 1 day ago It does but the interest banks gain is offset by losses when someone does not pay. Some portion of borrowers always defaults. The money "never exists in the first place" in a similar way as a lien (hold) on the car didn't exist. Car exists. Bank pays for car and holds the title. Dealership gets paid. Borrower drives the car and pays back monthly to the bank. Loan is closed, money is destroyed, lien is dissolved. permalink embed save parent report give award reply [–]rabbitlion 1 point 1 day ago The money existed all along of course. Someone deposits $100 and gets a 1% interest while someone else borrows $90 and pays a 2% interest. After 1 year the borrower pays back $91.8 and the depositor withdraws his $101. All in all, the bank has earned $0.8 due to the difference in interest rates. In practice, the $90 they lent out is probably going to be re-deposited by someone else and re-lent and re-deposited and so on, so they can earn on the interest rate difference several times. permalink embed save parent report give award reply [–]edgestander 1 point 23 hours ago Loans are assets to banks. When a loan gets repaid a bank losses that asset and replaces it with cash which if invested gains interest, at least the overnight rate. The money is destroyed because before being paid off the bank has the mortgage asset AND the customer had a corresponding cash amount now only the bank has that cash. permalink embed save parent report give award reply [–]clue5tickredditor for 3 months 6 points 1 day ago Before you all start arguing, how about explaining what you mean by "money". Show us the legal definition of the USD, and what it is measured against. Those who go with "everybody knows" can go back to arguing. permalink embed save report give award reply [–]confirmSuspicions 3 points 1 day ago Yup most of the disagreements people have on this topic are what constitutes 'money' being created. Well some call it debt. And that definition happens to make a lot more sense than saying money. We should really be talking about the velocity of that issued debt because the rest is a waste of time. Someone spends 1 minute on Google and finds a supporting paragraph for their argument and think they're right when there is an opposing opinion on the very next search result. permalink embed save parent report give award reply [–]samz22 5 points 1 day ago Guess what buddy you can have a credit card and when you swipe it….. Guess what your making your own money 🤣 permalink embed save report give award reply [–]Mintleaf007redditor for 3 months 2 points 23 hours ago if the credit card companies had to have the collateral to back up the card limit then it wouldnt be creating money but youre right it does. but its more the bank creating it not you. permalink embed save parent report give award reply [–]billybl4z3 2 points 1 day ago normal banking in ohio permalink embed save report give award reply [–]P_e_a_s_h_o_o_t_e_r 2 points 1 day ago Your picture is already incorrect. It says That loaned money, in turn, gets deposited back into the banking system where it gets loaned again... That's the money multiplier theory but it is incorrect. How money is created and common misconceptions are explained here. permalink embed save report give award reply [–]HugoJP 1 point 18 hours ago Yes it's much worse because they are not constrained by their amount of reserves, just by the rate set by the central bank that determines how profitable it is to make loans. permalink embed save parent report give award reply [–]P_e_a_s_h_o_o_t_e_r 1 point 18 hours ago Well, there's also regulation that dictates how leveraged they can be. But ultimately the central bank can control how much money is in the system just by the interest rates (short term interest rates directly and long term interest rates with QE). permalink embed save parent report give award reply [–]perfectlyboiledegg 2 points 1 day ago This is why banks are regulated to allocate capital in proportion to their loans. permalink embed save report give award reply [–]thedrearyblather03 2 points 15 hours ago In the risk management literature, bank equity is often called economic capital, and the process of selecting the amount of equity in the bank's capital structure is called capital allocation. permalink embed save parent report give award reply [–]perfectlyboiledegg 1 point 13 hours ago Yes and every regulating agency has different requirements and tiers for the %/tiers.s permalink embed save parent report give award reply [–]min11benja 2 points 1 day ago (A better answer) Do banks create money? -Does the pope shit on its hat? Yes of course, buy Bitcoin. permalink embed save report give award reply [–]luckydayjp 2 points 18 hours ago Don’t people take margin loans on their crypto too? permalink embed save report give award reply [–]Vivid-Life-6202 2 points 1 day ago In today's world, it turns out that banks work against people. That is why it is worth joining the crypto permalink embed save report give award reply [–]sickpeltier 1 point 1 day ago The answer makes no sense. permalink embed save report give award reply [–]realitycheckmate13redditor for 6 weeks 1 point 1 day ago so? permalink embed save report give award reply [–]MandelbrotFace 1 point 1 day ago Yes money is created when it's loaned but it's also destroyed when it's paid back. That's the bit that's missing here permalink embed save report give award reply [–]daOyster 1 point 15 hours ago So what happens to the interest that accrued on the loan? Does that get magically destroyed too or baked into their numbers? permalink embed save parent report give award reply [–]MandelbrotFace 1 point 13 hours ago The interest is kept by the banks as their profit for the service. Banks don't lend out other people's money or their own money. They are permitted to create and destroy money as loans are made and repaid. permalink embed save parent report give award reply [–]richmoney46[S] 0 points 1 day ago For everyone disproving me I know this is an oversimplification, however the spirit of the argument for Bitcoin is still here. Thanks for the karma everyone! permalink embed save report give award reply [–]JosePinPanPun 0 points 1 day ago banks are monopolising scam hah but when anyone else do it its a bad thing lol permalink embed save report give award reply [–]Exciting-Policy-8396redditor for 5 weeks 1 point 1 day ago I’m no economist, but is the reason inflation doesn’t track money supply because the “velocity” (aka it gets held up somewhere and doesn’t make it to the masses)? permalink embed save report give award reply [–]P_e_a_s_h_o_o_t_e_r 4 points 1 day ago* No, the velocity of money is something different. It's a measure for how many times the money is spend to buy goods or services in a certain time period, usually a year. It's complicated to explain how everything works, but here is explained how money is created and inflation happens. permalink embed save parent report give award reply [–]Exciting-Policy-8396redditor for 5 weeks 1 point 1 day ago Thanks for the link. I think I’m still struggling to understand the nuanced relationship between inflation and money supply. Would it be accurate to say inflation is caused by money (or debt) being created that isn’t paid back (unsuccessful business, etc)? permalink embed save parent report give award reply [–]P_e_a_s_h_o_o_t_e_r 1 point 1 day ago* People spending money on goods and services is an upward pressure for the prices of these goods and services and thus inflation. If more money is created, (all other things equal) people and businesses will have more money to spend on goods and services. So more money is indirectly an upward pressure for inflation. Although other things matter as well, like the velocity of that money. If the velocity is high this means the "turnaround time" of money is shorter AKA each dollar is spent more times on goods and services during a year. Someone's expenses is someone else his income, and he might spend this on goods and services as well. This happens multiple times in a year. So the velocity of money is a measure of how many times that same dollar is on average used to buy good and services during a year. This will thus also influence inflation as each time something is bought it's an upward pressure for the prices. A lot of money creation but a low velocity of that money will have a lower upward pressure on inflation than a lot of money creation with a high velocity of the money. In Japan for example money supply has been increasing a lot in the past, yet they've experienced long periods of deflation and a big recession as a consequence. There're a lot more things to consider to get the full picture. The paper I've linked in my previous comment explains much more of it but it's not the easiest thing to understand. It's useful to read it several times until it clicks. permalink embed save parent report give award reply [–]Commercial-Ticket442redditor for 1 week 1 point 1 day ago Good evening everyone beautiful day lovely weather we’re having permalink embed save report give award reply [–]WilsonFx1997 1 point 1 day ago 😅money is taken by those who have financial knowledge permalink embed save report give award reply [–]Relictasredditor for 1 week 1 point 1 day ago This is why I am so on board with bitcoin. You Cannot print more bitcoin. EVER! permalink embed save report give award reply [–]Grodgers73 1 point 1 day ago Do not take out a loan then. Smh. permalink embed save report give award reply [–]mikedensem 1 point 1 day ago It’s the creation of “debt”. permalink embed save report give award reply [–]danpaq 1 point 1 day ago Why do the banks keep needing to be bailed out? permalink embed save report give award reply [–]Beginning-Reply6730 1 point 1 day ago Not quite permalink embed save report give award reply [–]wildrabbitsurfer 1 point 1 day ago why they need to loan if they create ? those writers are stupid permalink embed save report give award reply [–]dannywitz 1 point 1 day ago I’d like to be skeptical and say this isn’t the full story, or it’s out of context, but I can’t. This is spot on. permalink embed save report give award reply [–]daveyboy1201 1 point 1 day ago They are the legal loan sharks basically, except they can't come to your doorstep and beat the crap out of you for not paying. permalink embed save report give award reply [–]Pastichas 1 point 1 day ago Why you do not explain, how government makes benefits payments? Bla bla bla bla permalink embed save report give award reply [–]DBNodurf 1 point 1 day ago And they use our signature to create it… permalink embed save report give award reply [–]Osamzs914 1 point 1 day ago Aren’t they using customer funds to loan out these monies? permalink embed save report give award reply [–]PeacefullyFighting 1 point 1 day ago I remember seeing a breakdown of how much money can be created from $100. I think this is temporary suspended but typically banks need about 10% of deposited funds as reserve. So it goes like this (forgive me if I mess up the math. $100 deposited, $90 is created $90 deposited, $81 is created $81 deposited, $74 is created $74 deposited, $66 is created I'm going to stop here but the pattern should be clear. We're not even half way though and already created $311.4 from a single $100 deposit. Obviously in reality there are a lot more factors at play but this scenario is 100% possible permalink embed save report give award reply [–]bitsteiner 1 point 1 day ago Correct except that it doesn't get loaned again. Why would banks do that when they can easily create money? permalink embed save report give award reply [–]Wild-Opposite-2827 1 point 1 day ago getbitcoin permalink embed save report give award reply [–]Sherbear1993 1 point 1 day ago bitcoin’s true value will be clear to the sheep after the Bear market permalink embed save report give award reply [–]babypho 1 point 1 day ago Proof of work permalink embed save report give award reply [–]Itchy_Jeweler 1 point 1 day ago Fractional banking also helped to rob people as well. In my opinion one of the worst financial invention EVER! permalink embed save report give award reply [–]AmbitiousDistrict374 1 point 21 hours ago It's called fractional reserve banking, permalink embed save report give award reply [–]qbits1234redditor for 6 days 1 point 21 hours ago Banks cannot create money!! They use theoretical leverage to loan out more than their cash deposits. This how we scale . permalink embed save report give award reply [–]FreeArt85 1 point 20 hours ago A perfect system. Let’s create a smart contract for that. permalink embed save report give award reply [–]libertyg8er 1 point 15 hours ago How would that be any different if people used Bitcoin to create loans instead of dollars? Wouldn’t there essentially be more Bitcoin than there actually is for accounting purposes in that scenario too? Debt capital is still capital. That is why assets = equity + debt. permalink embed save report give award reply [–]likethis999 1 point 14 hours ago Legal robbery permalink embed save report give award reply [–]BuyRackTurk 1 point 13 hours ago There is no need to "loan again" if you didnt need money to loan out in the first place. The right word is "spent again" permalink embed save report give award reply [–]purple_hamster66 1 point 9 hours ago This is a vast misunderstanding of what fractional means. It’s like trying to buy groceries with the future value of a CD. Who is this Investopedia author anyway? Banks don’t loan assets, only deposited money (with a little fudge factor to accommodate timing). Money is an asset but an asset is not necessary money. Assets include monies owed to the bank in the future, not money the bank has now. Banks can loan up to 90% of those money deposits (2023: now 100%), not their assets. There are some timing issues, that is, they can get the money deposits either before they loan, or after they loan it (by borrowing temporarily from other accounts), but they must get the loaned money deposited promptly. Think of it this way: when you cash that loan check, where do the dollars come from? It’s not from “owed” money, but from actual deposits. permalink embed save report give award reply [–]Medical-Junket1576 -2 points 1 day ago Wait till you learn about FDIC insurance. This is located on the governments website for all to see. So some back story. In the United States banks hold roughly 9 trillion in deposit assets. FDIC insurance covers you up to 250k ( there are stipulations with these such as if you have multiple accounts or the same parent bank owns multiple branches ). The FDIC insurance policy the government has is only for 125 billion dollars. This means in the result of a financial crisis or bank run, almost nobody is getting their money back. Instead you become a share holder or creditor of a defunct bank and are now broke. My suggestion is to get your money out of the fractional banking system and into real assets such as gold / silver and Btc. permalink embed save report give award reply [–]soundssarcastic -2 points 1 day ago The best part of the money they just invented out of thin air is that they expect interest on it like its a real loan. Rat bastards the lot of them permalink embed save report give award reply [–]poco 1 point 1 day ago They expect interest because they are paying for that money. permalink embed save parent report give award reply [–]SmoothGoing 1 point 1 day ago Interest pays for risk. When you stop paying on your rusty 2010 Nissan the bank will repossess it. But it doesn't want the car. It isn't going to get all of its money back out of it. permalink embed save parent report give award reply [–]nebra1 -2 points 1 day ago Isnt this like money laundering? permalink embed save report give award reply [–]rossquincy007 -1 points 1 day ago Newsflash the fed is privately owned permalink embed save report give award reply [–]P_e_a_s_h_o_o_t_e_r 3 points 1 day ago People will always complain no matter what. If it was owned by the government people would say they collude with the government. In fact people already say that, even though it's privately owned. permalink embed save parent report give award reply [–]AtheistMantis69 0 points 1 day ago So using money of an investor to pay another investor. Wasn't there a name for such endeavors? permalink embed save report give award reply [View Less]

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Cryptocurrency: Privacy Rising - Wasabi Wallet CoinJoin JoinMarket Update w Nopara73
by grarpamp 09 Feb '23

09 Feb '23

https://bitcoin-takeover.com/s13-e2-nopara73-on-wasabi-wallets-beginnings-a… S13 E2: Nopara73 on Wasabi Wallet's Beginnings and Future First launched in October 2019, Wasabi wallet has certainly elevated the standard for Bitcoin privacy. Mostly developed by Nopara73 (Adam Ficsor) with help from his friends [198]Matthew Haywood and [199]Lucas Ontivero, the first Wasabi release made CoinJoins and coin control a lot more accessible. As Nopara73 reveals in this episode, his journey in the world … [View More]

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Cryptocurrency: Kanye West For Crypto President 2024
by grarpamp 09 Feb '23

09 Feb '23

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