Fractional Reserve Banking, Central Banks and Taxpayer Bailouts

It is my opinion that you do not really understand the

concept of

banking.

All the banks are broke. Uh, Bank Santander,

Deutsche Bank, Royal Bank of Scotland, they're all broke.

And why are they broke? It isn't an act of God.

It isn't some sort of tsunami. They're broke because we have a system

called fractional reserve banking, which means that banks can lend money that

they don't actually have. It's a criminal scandal, and it's been

going on for too long. To add to that problem,

you have moral hazard, a very significant moral hazard

from the political sphere.

And most of the problem starts in politics and central

banks, which are part of the same political

system.

We have counterfeiting, sometimes called quantitative easing,

but counterfeiting by an- any other name.

The artificial printing of money, which if any ordinary

person did, they'd go to prison for a very long time,

and yet

governments and central banks do it all the time.

Central banks repress the amount of interest r- rate, rates are,

so we don't have the real cost of money, and yet we blame the real

retail banks for manipulating LIBOR.

The sheer effrontery of this is quite astonishing.

It's central banks. It's central banks that manipulate

interest rates, Commissioner. And plus, underneath all this, we

talk loosely, in a rather cavalier fashion, do we not,

about deposit guarantees?

So when banks go broke through their own incompetence and

chicanery, the taxpayer picks up the tab.

It's theft from the taxpayer. And until we start

sending bankers, and I include central bankers

and politicians, to

prison for this outrage, it will continue.