Thursday, 7 January 2016

How safe is the money you’ve deposited in your bank?

According to Ellen Brown, it’s increasingly unclear how safe depositors’ money is in the US and Europe. Reason is that banks use depositors’ money to place mega derivative bets, and want ever more freedom to do that. Plus banksters run rings round politicians and regulators when it comes to altering legislation so as to enable banksters to do that.

Assuming Ellen Brown is right, that’s just one more argument for full reserve banking. That’s a system under which money which is supposed to be totally safe is lodged with the state, while derivatives, loans to mortgagors and businesses and anything faintly risky is funded just like any normal corporation: that is by shareholders and bondholders who stand to lose everything if the worst comes to the worst.

Ellen Brown more or less says that in her final paragraph which reads, “Meanwhile, local legislators would do well to set up some publicly-owned banks on the model of the state-owned Bank of North Dakota – banks that do not gamble in derivatives and are safe places to store our public and private funds.”

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