My Opinion > Economics

The Fatal Flaw of 100% Reserve Banking

In: Economics • August 4, 2014

There is a huge divide between theorists of two allegedly opposed monetary doctrines: the 100% reserve bankers and the free bankers. Although I do contend that both postures have more in common than many at first sight think, the fatal flaw of 100% reserve banking can be boiled down to one very simple error. When we take this fatal flaw away, nothing stands in the way to reconcile both doctrines. Demand Deposits versus Time Deposits Defenders of 100% reserve banking [...]

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