Comments on: OSO: Thoughts on fractional lending and quantitative easing http://housingdoom.com/2009/03/12/oso-thoughts-on-fractional-lending-and-quantitative-easing/ Thu, 24 May 2012 17:28:21 +0000 hourly 1 http://wordpress.org/?v= By: malthus http://housingdoom.com/2009/03/12/oso-thoughts-on-fractional-lending-and-quantitative-easing/#comment-16013 malthus Sat, 14 Mar 2009 13:34:49 +0000 http://housingdoom.com/?p=2101#comment-16013 "But what happens once the economy begins to recover, credit begins to flow again and inflation begins to rise? Well obviously the central bank could then withdraw all or part of its deposit with commercial banks." After distorting the credit markets by falsifying the amount of money available for capital expansion, the Fed now withdraws its funds and triggers a recession. What if depositors could anticipate the withdrawal and ask to cash out their accounts while money is still available? They could then use this cash to buy out failed businesses for a fraction of their book value. Money once injected can not be readily withdrawn. Igor says bad idea. Let's have honest money that everyone can thrust because it cannot be readily manipulated. Let's end the gold quarantine and call gold money. “But what happens once the economy begins to recover, credit begins to flow again and inflation begins to rise? Well obviously the central bank could then withdraw all or part of its deposit with commercial banks.”

After distorting the credit markets by falsifying the amount of money available for capital expansion, the Fed now withdraws its funds and triggers a recession. What if depositors could anticipate the withdrawal and ask to cash out their accounts while money is still available? They could then use this cash to buy out failed businesses for a fraction of their book value.

Money once injected can not be readily withdrawn.

Igor says bad idea. Let’s have honest money that everyone can thrust because it cannot be readily manipulated. Let’s end the gold quarantine and call gold money.

]]> By: Chuck Ponzi http://housingdoom.com/2009/03/12/oso-thoughts-on-fractional-lending-and-quantitative-easing/#comment-16012 Chuck Ponzi Fri, 13 Mar 2009 05:54:54 +0000 http://housingdoom.com/?p=2101#comment-16012 Well, It doesn't change that there are few good credit risks. Banks don't lend partly because there's nothing worth lending for. The speculative fervor of the last few years burned out all of the opportunities. Deflation is self-perpetuating. Well,

It doesn’t change that there are few good credit risks. Banks don’t lend partly because there’s nothing worth lending for. The speculative fervor of the last few years burned out all of the opportunities.

Deflation is self-perpetuating.

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