{"id":65177,"date":"2023-03-16T12:40:36","date_gmt":"2023-03-16T17:40:36","guid":{"rendered":"https:\/\/olduvai.ca\/?p=65177"},"modified":"2023-03-16T12:40:36","modified_gmt":"2023-03-16T17:40:36","slug":"unsound-banking-why-most-of-the-worlds-banks-are-headed-for-collapse","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=65177","title":{"rendered":"Unsound Banking: Why Most of the World\u2019s Banks Are Headed for Collapse"},"content":{"rendered":"<header class=\"content-header fixed\">\n<h3 class=\"entry-header content-list-title\"><a href=\"https:\/\/internationalman.com\/articles\/unsound-banking-why-most-of-the-worlds-banks-are-headed-for-collapse\/\">Unsound Banking: Why Most of the World\u2019s Banks Are Headed for Collapse<\/a><\/h3>\n<\/header>\n<div class=\"content-thumb\"><img loading=\"lazy\" decoding=\"async\" class=\"attachment-post-thumbnail size-post-thumbnail wp-post-image\" src=\"https:\/\/internationalman.com\/wp-content\/uploads\/2016\/02\/unsound_bank.jpg\" sizes=\"auto, (max-width: 600px) 100vw, 600px\" srcset=\"https:\/\/internationalman.com\/wp-content\/uploads\/2016\/02\/unsound_bank.jpg 600w, https:\/\/internationalman.com\/wp-content\/uploads\/2016\/02\/unsound_bank-300x198.jpg 300w\" alt=\"Bank collapse\" width=\"600\" height=\"395\" \/><\/div>\n<p>You\u2019re likely thinking that a discussion of \u201csound banking\u201d will be a bit boring. Well, banking should be boring. And we\u2019re sure officials at central banks all over the world today\u2014many of whom have trouble sleeping\u2014wish it were.<\/p>\n<div class=\"content\">\n<p>This brief article will explain why the world\u2019s banking system is unsound, and what differentiates a sound from an unsound bank. I suspect not one person in 1,000 actually understands the difference. As a result, the world\u2019s economy is now based upon unsound banks dealing in unsound currencies. Both have degenerated considerably from their origins.<\/p>\n<p>Modern banking emerged from the goldsmithing trade of the Middle Ages. Being a goldsmith required a working inventory of precious metal, and managing that inventory profitably required expertise in buying and selling metal and storing it securely. Those capacities segued easily into the business of lending and borrowing gold, which is to say the business of lending and borrowing money.<\/p>\n<p>Most people today are only dimly aware that until the early 1930s, gold coins were used in everyday commerce by the general public. In addition, gold backed most national currencies at a fixed rate of convertibility. Banks were just another business\u2014nothing special. They were distinguished from other enterprises only by the fact they stored, lent, and borrowed gold coins, not as a sideline but as a primary business. Bankers had become goldsmiths without the hammers.<\/p>\n<p>Bank deposits, until quite recently, fell strictly into two classes, depending on the preference of the depositor and the terms offered by banks: time deposits, and demand deposits. Although the distinction between them has been lost in recent years, respecting the difference is a critical element of sound banking practice.<\/p>\n<p>\u2026click on the above link to read the rest\u2026<\/p>\n<p>&nbsp;<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Unsound Banking: Why Most of the World\u2019s Banks Are Headed for Collapse You\u2019re likely thinking that a discussion of \u201csound banking\u201d will be a bit boring. Well, banking should be boring. And we\u2019re sure officials at central banks all over the world today\u2014many of whom have trouble sleeping\u2014wish it were. This brief article will explain [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[61,63,124,150,6227,1708,6228],"class_list":["post-65177","post","type-post","status-publish","format-standard","hentry","category-economics","tag-banking","tag-banks","tag-central-banks","tag-collapse","tag-doug-casey","tag-fractional-reserve-banking","tag-international-man"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/65177","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=65177"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/65177\/revisions"}],"predecessor-version":[{"id":65178,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/65177\/revisions\/65178"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=65177"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=65177"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=65177"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}