Believe it or not, there is growing interest—even among market friendly economists—for the government to mail checks to every American. Guess it’s time to explain why this is a really bad idea.read more
FRACTIONAL RESERVE BANKING CAUSES THE BUSINESS CYCLE: by Robert P. Murphy
On April 16, I debated the Cato Institute’s George Selgin on the resolution, “Fractional Reserve Banking poses a threat to the stability of market economies.” I was arguing for the resolution, while George was against. This is an area where even self described Austro-libertarian economists are hotly divided, and moreover fractional reserve banking plays a key role in the book I co-authored with Carlos Lara (How Privatized Banking Really Works). For these reasons, it’s worth summarizing my case in the present article.