Professor Patrick Barron on How Do Banks Create Money Out of Thin Air? 07/02/11 RFM

** How Do Banks Create Money Out of Thin Air? Revealing the Secrets of How Banks Get Away with it Every Day ** with Professor Patrick Barron


In this important show we review Murray Rothbard’s great book, The Mystery of Banking, originally written in 1983, which is perhaps the book that most clearly and completely DEMYSTIFIES Banking and how it works. Gene Epstein, a columnist for Barron’s Magazine, has called The Mystery of Banking the "best book to read for anyone interested in understanding how our banking system works."

Patrick Barron has been a consultant to the banking industry since 1985. He teaches at the Graduate School of Banking, University of Wisconsin, Madison and Austrian Economics at the University of Iowa.

What is Banking and How do Banks Work? They are much more than just a place to put your money and from which to borrow money – banks are either bastions of economic stability or creators of economic instability.

Does the bank creation of money out of thin air, called "fractional reserve banking" make banks inherently prone to bankruptcy? In fact, this is WHY banks want a "lender of last resort", called the Federal Reserve….. so that THEY can get bailed out as needed!

But don’t we need banks to be Centrally Regulated? The Mystery of Banking shows how, contrary to conventional wisdom, banking in the US has always been highly regulated and tied intimately to government expansion.

We will also discuss why Big Banks love Government (and why Government loves Big Banks).

Rothbard’s classic book removes the veil of ignorance so that everyone can understand how Money and Banking works today – and should be allowed to work if we want a more Stable and Growing Economy.

Money is one half of every transaction you make in the Marketplace – this show will give essential information that every person, young and old, needs to have. Please listen and share this excellent broadcast with others.

With Show Creator and Radio Free Market Guest Host Mr. Drew Hjelm.

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