Do the banknotes have a gold fringe? I think that’s what distinguishes M0 from M1.
Ok, I’ll stop taking the piss, but I had a serious point in asking mustang what he thought about the Sovereign Citizens legal arguments. Because it might give him some insight to point out that his “arguments” here resemble theirs in presentation - numerous poorly-grasped ideas placed semi-coherently in proximity to one another in sentences without any real understanding.
Moderating
Given that mustang19 is more interested in defending his proposed scheme than obtaining factual information, I’m going to move this to Great Debates.*
Colibri
General Questions Moderator
*GD mods please forgive me.
Ok, I’ve done that to 1000 customers.
So right now, it seems like I am $1000 in the hole, and I have deposits of $1,001,000.
Now what?
You’re not 1000 in the hole because you invested a miniscule amount in treasuries to cover transaction costs.
Wait, what?
Offer some one $1 to deposit $1,000 - OK, that’s .1% interest, which isn’t very good, but let’s go with it. What do other banks falling have to do with my bank making money?
It doesnt matter if they fail. You get infinite money either way.
Its not interest its just an upfront free money in addition to normal operations.
Ok. I’ve invested a miniscule amount in treasuries to cover transaction costs.
So, right now, I have no money and $1,001,000 in deposits.
Now what?
So, when we have infinity money, which tank should we build?
Now you have a massive bank with no effort and can invest infinite money.
You seem to be skipping over some steps.
I have a bank with no income, and $1,001,000 in deposits.
What’s my next step? What do I do to turn that $1,001,000 of other people’s money into infinite money that I can keep for myself?
I think you’ll find that it is turtles all the way down.
Not infinite - in this example, you have around 1 million dollars you can invest.
This is exactly how banks work, and how they make money. But, there are costs associated with doing business. Banks clearly make money (some are very profitable), but they don’t make “infinite” money.
Invest it. In treasuries or whatever.
Well of course it would be physically limited by Earths resources.
Are you suggesting that the fractional reserve banking system would prohibit a bank from building a spaceship?
Ok. I’ve invested $1,000,000 in something that provides 5% a year.
What’s the next step? I’m not seeing the “infinite” money yet.
Now we are getting somewhere.
Without gaming the system (doing something illegal), there are limits on how much money you can make as a bank. There are always competitors who are trying to steal your customers, and the bigger you grow, the more expenses you have. Attracting new customers becomes a major expense.
This is why NO business grows without bound.
You already made 1000x instant money so you can just repeat that. Transaction costs are a minor technicality. If you make 0.1% a day with a 10x reserve requirement then you make 2700% a year and will have all the money in the world in 6 years.
I haven’t made ANY money. That $1,001,000 belongs to someone else. It’s not mine.