저자: GeorgeGammonvsPeterSchiff—대담형식,출연자소속명시없음 · 외국인
요약 보기
두 출연자는 은행이 예금(저축) 없이도 신용을 창출하는지를 두고 논쟁함. Gammon은 현대 신용화폐 체계에서 은행이 대출로 돈을 만든다고 주장하고, Schiff는 정부 예금보장 등 개입으로 은행 체계가 취약하며 대공황급 충격 시 대부분 은행이 붕괴할 것이라 봄. 금 본위 복귀 문제에서는 Schiff가 금을 화폐로 보고 T Gold 사업을 소개하나 Gammon은 금이 실사용 교환수단이 아니라고 반박. 특정 종목·지수의 1~3개월 가격 방향 예측은 없음.
다듬은 글
George, in in a free market without government guarantees, credit's going to only come into existence out of savings. And banks are going to only be able to I I disagree out of productivity. No, no, there has to be savings to be loaned out. You can't just loan out productivity. If I want to borrow money, somebody has to lend it to me.
And in order to So, there has to be savings underlying uh the loans. But, the government has come in with all these guaranteed deposit accounts uh to allow financial institutions to lend out tremendous amount of money with hardly any reserves. And the reason they're able to do that is because the government has guaranteed all the the deposits.
Well, I agree with you. banks don't have to care about about a run, about people pulling out their money, because they know the government will will will bail them out if there's any problem. Well, I completely agree with Peter on the government intervention that we should not have that the banking system, we should not have that money, we should not have that with interest rates.
Uh but, where I completely disagree is on the savings component. This is a The Austrians get caught up on this, and it's just it it might have been applicable in the 1600s, but it's definitely not applicable today in the modern monetary system. So, let me give you an example. So, the way a bank creates money, especially in the euro-dollar system, is they don't need currency, they don't need money to begin with.
Uh they don't need dollars, they don't need bank reserves, they don't need uh green pieces of paper. Uh if I'm a bank and I'm lending money to Mario, let's say, uh he needs a loan for a million dollars to start a new business. I'm going to go ahead and give him a a loan for that. That becomes a deposit liability on my balance sheet.
That effectively is dollar M2. Okay, I've just increased the money supply. Now, the offsetting asset on my balance sheet is that loan that I just created. So, I just created a million dollars, and I didn't have any money to start with. So, there doesn't need to be in the modern system going to go and and and and and pay his rent or pay his employees, or pay his bills if he doesn't actually have any money.
Yes, and now we're talking about bank settlement, because what he's going to do is he's going to transfer that deposit liability, because his checking account just increased by a million dollars. He's going to take that million dollars, and he's going to send it to another bank to pay let's just say a million dollar fee for starting the business or something like that.
So, then it's an interbank transaction. So, then that liability would go from my bank to another bank. Well, I've got to offset that that liability. I can't just give them a liability. So, I either have to send them an asset, like a bank reserve, or if I don't have that, then I'm just going to go ahead and borrow extend They're going to extend credit to me.
So, that's the asset that offsets the liability that I just is the credit that's being extended coming from? It's It's just It's a It's ledger money. But but It's just credit. It It's just It's on a ledger. It's just a bank extending credit. This What What Peter's talking about here is this money multiplier thing that you read in textbooks, and people have been talking about this for probably centuries.
It's total Well, I agree I agree it's too. I don't agree with that. The That's not the way the system works. Banks lend money into existence, and they don't need any savings to lend that money into existence, period. That's the way the system works. Well, I guess that's how That's how you That's how you inflate cuz that's inevitably going to burst, and there's going to be a run on those banks, and the credit's going to vanish, and the asset prices that were propped up as a result are going to come crashing down.
You were saying Is there a limit, Peter? Is there a limit, George? Is there a limit to how much could be created? How much ledger how many banks there are. Depends how many ledgers there are. Right? Because as an And this This gets very, very deep in the weeds right here. Uh but if you just have one ledger, right?
So, as an I'll use the example And of course George that's what that's all denominated in dollars, isn't In that world, prices are going to go through the roof, too, because if you're creating all this credit and that's creating demand, but there's no supply associated with it. There hasn't been any production uh that hasn't been consumed because when you when you create credit out of savings, then there is underconsumption.
Uh the saver is not consuming and that allows for more goods and services to be purchased with the borrowed money. But if there's nobody reducing their consumption and the credit is just being created, uh then there's just massive increase in prices because you you you don't have the underconsumption.
Right and wrong. So, I what the key is is productivity. Right? So, if all that bank lending that's creating that new money supply goes to unproductive means, then you're right. You're going to have more currency as units, excuse me, chasing the same amount or fewer uh goods and services. And you combine that with velocity and that's going to increase the rate of consumer prices, absolutely 100%.
But if you have those banks creating that new money supply for productive purposes, as an example, lending to a widget maker uh to create more widgets, uh then you're not going to because now what you're doing is you're increasing the supply of goods and services along with the supply of money. Yeah, I mean but at least then we agree that to the extent that this process finances consumer credit or government spending, it's purely inflationary.
Yeah, and the government spending is key, too, because that because all government spending isn't created equal. So, if we look at the government spending that we saw during 2021 as an example of stimmy checks, that massively incre- in- increases velocity. And that's really where you're going to get the the acceleration of consumer prices.
But if that Yeah. Well, that's what most of government spending is. It's transfer payments, Social Security, Medicare, Medicaid, government pensions, even the military. None of that is productive investment. That's all consumption. And then you have mortgage credit, auto loans, student loans, credit cards.
All that is But if it's not productive, but if it's not productive, then wouldn't it lead to inflation? Yes, it has to. No, no, no, no, no. Well, again, are we talking about Peter's definition or most people's definition? It's well, there's only one definition. I I didn't invent it. Just go look at an old dictionary.
Then you'll get the correct definition. Yeah, but but nowadays most people when you say inflation, uh they think an accelerary or increase in consumer prices. by design. That that's not an accident that people don't understand inflation. They don't understand it because the government wants to blame it on on on on the private sector.
They want to blame inflation on prices, not on money supply. Right, but let's talk about mechanics, not necessarily the Yeah. semantics uh involved. So, uh if you go back, and I think Maro, you've been doing this, like to the 1950s, uh you see that this system that we're talking about, this dollar monetary system, the eurodollar system, whatever you want to call it, it's really a network of banks outside of the United States.
And this was uh uh an invention of the free market. Uh because they didn't have enough dollars circulating after Bretton Woods, so they had to figure out a way to create more dollars. They didn't have the bank reserves, and we weren't running the massive deficits that we're running right now, so you didn't have enough dollars getting out of the United States.
So, they started creating this ledger money, this which is basically credit, it's dollar-denominated credit. And that's this monetary system that we have today. And and that was a result of the free market. Um that that was not a result of government intervention or forcing them to do X, Y, and Z. So, that the system that we have today, uh where they don't necessarily Now, they can use bank reserves to settle, uh but they don't necessarily need those bank reserves, or they don't need savings, or they don't need dollars to create more dollars.
And the key there that they're lending it into existence. So, if uh as an example, uh there is less demand for dollars globally because the Fed's balance sheet is such a very small percentage of global dollar M2, if you have less demand, you have more loans being paid off because most of those loans are short-term and the actual supply of dollars contracts.
And that's one of the things that is a there's a lot of bugs with the system, but that's definitely one of the features. Go ahead, Peter. Yeah, well, yeah, I mean and the problem is we don't get the money supply contracting the way it's supposed to, especially during a recession. You're supposed to get a contraction in money supply.
That's that's that's the whole idea, but you can't say that even though, you know, the free market did create the concept of bank credit that it's not a free market today because there's so much government intervention in the banking system that with that. There's no any free market market forces at
I agree with that, for sure. And and the reason the reason the banking system is so fragile, the reason that basically the entire US banking system is insolvent today is because of the government intervention into that into the banking system mean? What do you mean by insolvent? What do you mean by insolvent, Peter?
Well, I think all of the major US banks would fail if the government pulled its its support. So, if you know, if the if the US government basically said, "Look, there's no more deposit insurance." The institutions have to stand and fall on their own creditworthiness. I think all the major banks would would would fail.
I I don't think I I you know, I think it's only because the government has propped them up and and I think that they're they're all going to fail even with the government supports except that they won't fail because they'll get bailed out, right? So, they won't be allowed to fail because they're too big to fail, but I think they're in a position where they would fail.
You know, if we had an economic downturn, let's say like we had in the Great depression. The current banking system would be would would fare far worse than the banking system we had back then. I mean, without any government uh support during the 1930s, only a tiny fraction of deposits were actually lost in the entire period of the bank de- the you know, the Great Depression.
I mean, the vast majority of banks you know, people didn't lose anything. You know, maybe about a third of the banks failed, but even then the banks that failed that they weren't wiped out. You most of the cases you didn't lose all your money. You lost some of your money. Um but but but today, I think if we had something like that they'd all be gone.
Everything would be would be lost. And in fact, during the during the depression, I mean, one quick point. Yeah. The dollar gained so much purchasing power during the depression. Prices fell so much that bank deposits actually gained in value. And for a lot of people, even if they lost some of their money in banks, the money they didn't lose bought more.
So, overall, they actually had more purchasing power despite the losses. But now we have so much inflation, even if the bank doesn't fail, you lose money. Yep. My point is, going back to the 1950s and the fact that it was that the monetary system that we do have today was created uh by the free market.
So, for for me, if it was created by the free market, uh the solution really isn't to go to a gold standard or another system that's run by central planners uh such as a a BRICS currency. Uh the solution is to get the government out of the current system. Uh because if you eliminate the government from the current system, and that system was created over decades by the free market, uh then by definition, I think it's the best system that we can hope for.
Now, that doesn't mean that it's perfect. It doesn't mean that it's great. I should have said it's probably the least bad system uh monetary system that we the the system now actually great. it's now built it's now built on the moral hazard of deposit insurance. That it it's so it it it's not really a free market when nobody gives a damn
I'm not saying it is now, Peter. Peter, I'm not saying that it is a free market now. I'm I'm saying that it was created by the free market. So, the solution the solution is not necessarily to go to a BRICS currency that's going to be a central bank digital currency, or the solution isn't to go to gold, which by the way the the the free market moved away from because it wasn't very efficient.
No, gold was very The free market didn't move away from gold. No, because when the free market originally created the banking system and created bank credit, it was still underlyingly backed by gold. I mean, gold was still the money. Yeah, but no one used it, Peter, because no one used it. But, no one used it because it was very cumbersome.
It was inefficient. It was tough to settle. And and all the bank notes all the bank notes were liabilities to pay gold. That was the money behind it. That's why they're called money substitutes. The the the world created ways of utilizing money through a money substitute. That's why currency is not money.
Currency is something that's backed by money if it's legitimate. Gold's not money. Of course it is. No, it's not. Try Peter, try using gold as a medium of exchange today. Let When when when we hang out, we're going to we were talking before. Peter and I are going to hang out on Tuesday night. Let you and I will go down to the local bar, we'll go grab a beer, and let's try to see if we can use gold as a monetary as a medium of exchange.
It's not going to happen. Just just because people aren't most people aren't using it as a medium of exchange doesn't mean it's not. But, I'll tell you like look, at my my business that I'm developing around T Gold, right? Why don't you go over to T Gold and open up your account. But, what I'm going to be doing with T Gold is making it very easy for two parties to buy and sell and transacting gold and settle in gold instantly at at at very little cost.
And And the first thing we're rolling out with our gold is is debit cards and secured credit cards. So, if you have, you know, $10,000 worth of gold and you want to take me out to dinner in a restaurant and the bill comes and it's two or three hundred dollars and you want to pay with your gold, you could use that card and your gold will be sold in real time, converted to dollars and pay.
But, if the merchant wants gold, there doesn't have to be a conversion. The gold can go directly from your account to the restaurant. But, no merchant wants gold, Peter, because not? Because their liabilities are just cuz their liabilities are denominated That depends. in another currency and they don't want to take Now, they might want their savings in gold,
But, I can Well, you know what? I can And what you just described, it may be not It may be interesting, but you're just talking about creating the existing system that we have. No, if I can get gold instead of dollars. If If I can just use my ATM card to go down to that bar that we were talking about, why would I use a gold ATM card when I could just use my normal ATM card?
Well, it depends. It doesn't It's not any better. You're just creating You're recreating a system, but the a system that's just worse than the where we are right now.
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