THEFIXBOOKSTORE.COM

THEFIXBOOKSTORE.COM

The Future Banking Systems & Alternatives

The future U.S. banking systems and alternatives for the 21st century can only start by understanding that fractional-reserve banking has come at far too high a cost for any society to continue to sustain.  This means we have to have an approach to commercial banking that is both self-regulating and self-sustaining as our own sorrows have demonstrated the fact that the money always ensures that anything less than a self-regulating system will be completely corrupted by government and the banking industry.  The corruption is the real disease - and because money is the root of all evil (or so they say) - the real issue is always going to turn back to the principles of having a commercial banking system that is both self-sustaining and self-regulating in nature like the Consumption Banking System approach developed by Clint Lovell as part of his omnibus institutional reorganization under Lovellian Economics.

Why is this important?

To understand the importance of the role banking really has with the economy is demonstrated in the knowledge of inflation and the cool and objective appraisal of the "cashing in" of our industrial basin and transference of all those manufacturing jobs to other economies so that the "cash" realized from these asset conversions could be used to fuel consumption spending in our economy.  Indeed, it could be said the real casualty in our modern era has been accurate information and the intentional perpetuating of the false premise that consumption is the key to growth in our economy.  The ugly truth is that consumption is the least stimulative activity we can undertake in our economy as it creates the smallest residual benefit in terms of stimulating growth in real output.  Central to this problem is the principles used in the structure and operation of our commercial and central banking institutions.  In point of fact, these institutions have the calamitous feature of intentionally creating the conditions that foster the conditions that directly fuel poverty - the very outcomes that organized banking systems exist to end.  The one point to always bear in mind is that fractional-reserve banking is the only banking system approach known to man that has the impact - intentional or not - of making sure that poverty-stricken households have almost no chance of ending their struggle with poverty.  Indeed, the outcomes wrought by fractional-reserve banking can be said to demonstrate the principle of allowing the banking industry to concentrate wealth to its exclusive benefit (in 2009, the average Wall Street banker earned more than 8 times the median income of the average American total household) and for the benefit of the ruling-class the banking industry depends upon to defend its largesse against all comers (and this is true in all nations), because; fractional-reserve banking is not self-sustaining and that is the most devastating and damning evidence against its use of all possible charges that could be brought against it.

Our future banking system decisions require of us the ability to make objective measurements of what we have actually been able to receive versus what we have been promised as the outcome.  This "credibility gap" is at the heart of the modern, statist view of how the most important institutions in a political economy are supposed to function; there is what is "sold to the people" and there is what was actually delivered.  This suggests the real solution must be one that does not require us to believe that people will be able to answer the challenges our economies will face and that we must replace policy-based decision-making with a system that reacts solely to market signals and events that are not controllable by humans (and therefore corruptible for the benefit of one group of stakeholders in the economy (usually bankers) over the interests of all others).

This also suggests that we provide a system in which real confidence is not necessary.  We place no measure of confidence on the relative wetness of water - we take it for granted - and we need to have a banking system that acts the same way and is just as transparent as a glass of water.  People are finally coming to the conclusion that the mysterious nature of the central bank system operations and its "beyond accountability" reporting perquisites are actually hiding something that is fundamentally wrong and biased.  These people are, of course, correct.  The most important lesson we have learned from our banking system is that any large-scale institution - that is used by all the stakeholders within a given political economy - cannot base its sustainability on subjective principles.  The vagaries of "consumer confidence" and "credit confidence" and "market makers" is completely anathema to the ideals of free-market capitalism.  The system is either sustainable or it isn't a system at all.  Our new banking systems have to be self-sustaining and evolved beyond these subjective considerations and work solely based upon the metrics established by market activity (supply and demand - e.g.: the Consumption Banking System).  These approaches lead to outcomes that are completely different and that is what the 21st century is likely to embrace.