One of my pet topics

seekingalpha.com/article/1299731-toward-...less-monetary-system

Interesting snippet on there btw...

'Canada, for instance, has no reserve requirement ...'

Ummm lol...I wonder if he understands the ramifications of what he just said.
Any further info to verify that?

I can't see a cashless society anytime soon. I recall a news story about dollar coins over here. They get made in huge numbers but hardly anybody over here uses them. I have only ever had them from vending machines. I also saw a YouTube video once about how useless the penny is. There is a big case for doing away with the penny if memory serves although I am not sure how you get around change for something costing 99 cents.
I guess it just seems a long way off even though most people seem to swipe now.

gilliganscorner.wordpress.com/2008/04/06...eserve-requirements/

Woah....

Some countries (including the UK and Canada) have eliminated reserve requirements altogether or lowered them to negligible levels
moneyterms.co.uk/reserve-requirement/


WTF!?

So much then for even bothering to think that fractional reserve exists now its just no fucking reserve whatsoever lol.

andyh wrote: I didn't know about Canada, but the UK has never had a reserve requirement. The last time when there was even a record of the percentage of reserves that banks have was 1998, when it was 3.1%. I've tried very hard to find any figures that post-date that and it's completely impossible. It's quoted on Wikipedia here:

en.wikipedia.org/wiki/Reserve_requirement#United_Kingdom
And you can see the Daily Telegraph still quoting that figure fourteen years later here:

www.telegraph.co.uk/finance/china-busine...-fears-continue.html

I can't quote from that article as I've used up my quota of Telegraph articles for the month and it's now behind a paywall! But it does mention the 3.1% figure if you read it. But they're just quoting the 1998 figure. Realistically, it has to be far, far less by now. But no-one knows what it is. If anyone can show me any figures that post-date 1998, I'll happily look at them. But really it's just sawdust that's backing this system up, little though most people know it. This is why I haven't had any money in the bank for many years, just enough to live off for a while, but I've cut it down to enough to pay my bills for a month now. If I could operate completely in cash, I would.

And heres me thinking I couldn't be surprised anymore.

I have a hard enough a time as it is getting people to believe the fractional reserve system, now I have to pass on the knowledge of a bugger all reserve system.
So this is basically a license to loan as much as they like with no consequences whatsoever just so long as they were in business as a 'bank' before a specific date.

F*ck me..

3% is bad enough thats like 32:1

The old story we've been told of 9 or 10:1 is history jesus.

andyh wrote: I thought you would know this, I should have posted it more often! Realistically, 32:1 would be an optimistic scenario because think what has happened since 1998, massive house price inflation completely driven by lending, credit became far more easier to get hold of on a personal level, and we know numerous banks have been having massive capitalisation problems. I would be very surprised if it's more than 1%. There's no way of knowing because they don't even bother keeping figures!

I feel dizzy.

/grabs hold of desk and collapses on the floor

andyh wrote: This must be why no-one listens to me!

I actually just found something new on this subject, so thanks for making me look it up! You can see a discussion here:

v.positivemoney.org.uk/discussion/442/qu...irement-in-the-uk/p1

You can see a lot of speculation with no-one really knowing a solid figure, and someone says the following:
Someone asks for a link to confirm it, and none is forthcoming, but I just found this:

www.hm-treasury.gov.uk/d/consult_review_...it_scheme_180213.pdf
You can see the Bank of England here discussing the switch from a reserve ratio to cash reserve ratios (which happened in the early years of the Thatcher government, incidentally):

www.bankofengland.co.uk/statistics/pages...lesale_discount.aspx
So as far as I can see that's the current situation, I thought it would be less than 1%, I'm glad I found that out.