
Money Creation in the Modern Economy (2014) [pdf] - rfreytag
http://www.bankofengland.co.uk/publications/Documents/quarterlybulletin/2014/qb14q102.pdf
======
cs702
IMHO, the easiest way for an engineer to understand "money" is as a _network
of debits and credits_.

Forget theory, ideology, and politics for a moment. Let's focus on the
mechanics of how things work.

When a bank lends money to a company, the bank and the company book
corresponding accounting entries and money is created "out of thin air." (The
bank is required to hold a minimum reserve balance, which they can borrow as
needed from others in the financial system, or from a central bank).

When a central bank (like the Federal Reserve or the Bank of England) lends
money to a bank, the central bank and the bank book corresponding accounting
entries and money is created "out of thin air." Central banks literally click
a button and create accounting entries.

When _you_ borrow money from a bank, the bank books the corresponding
accounting entries, and you probably won't record anything on an accounting
program -- but your bank will keep track of all balances, to the cent.

When a borrower cannot pay back a loan from a bank, the bank writes off the
loan balance, and reduces the borrower's liability by an equal amount.

The balance you have on your bank account is a liability on your bank's
accounting books.

The balance on your credit card is an asset on your credit card company's
accounting books.

When you buy something and pay with a check or a debit card, the financial
system records all the necessary accounting transactions to update everyone's
debit and credit balances.

The dollar bills you hold in your wallet are nothing less than 'certificates'
indicating that the US government has a liability of the amount shown on those
dollar bills, payable to the holder of those dollar bills.

In our modern economic system, the easiest way to understand money is as a
global, mostly electronic network of accounting debits and credits, with
balances varying as people conduct transactions.

For every debit there is an equal credit, and vice versa, so globally, total
debit balances are _always_ equal to total credit balances, and total debit
transactions are _always_ equal to total credit transactions.

Double-entry bookkeeping all the way down.

It is really quite something to behold.

~~~
VT_Drew
>The dollar bills you hold in your wallet are nothing less than 'certificates'
indicating that the US government has a liability of the amount shown on those
dollar bills, payable to the holder of those dollar bills.

Except dollars are no longer backed by anything. So the governments liability
is nothing. What are they going to do trade you a dollar for a dollar? It is
literally just paper. It is a stretch to still think of it as a 'certificate'.

~~~
ellius
Edward Harrison has good piece on this and the concept of "currency
revulsion":

[https://www.creditwritedowns.com/2011/10/currency-
revulsion-...](https://www.creditwritedowns.com/2011/10/currency-
revulsion-2.html)

------
gedy
This reminds me of one problem I have with people and politicians when
discussing hot-button "income inequality" topics: Many people act as if the
world is still on the gold-standard, and if this person has more, they took it
from those who have less, etc in a zero-sum game. The real problem is not that
simple though, and money being created and diluted in a way that makes
simplistic solutions like "capping CEO pay" and setting living wages do not
target the people and systems outside this who are the real problem.

~~~
davidw
"The economy is not a zero-sum game" is something a _lot_ of people don't seem
to get.

~~~
jsprogrammer
For any given period of time, the game is zero-sum.

For example, if there is one apple, either you can have it, or I can have it.

Where is the non-zero-sum game?

~~~
davidw
You could plant an apple tree. That's definitely not zero-sum. After that you
could could invent better ways to ship apples so that more people can enjoy
them. Or cross breed them to provide different types of apples for different
uses and tastes. You could make cider from the leftover apples instead of
throwing them away, so that less is wasted. In other words, there are tons of
ways to make better use of what we have, or create new things. The economy is
not zero-sum.

PG has a nice essay that explains this:
[http://paulgraham.com/wealth.html](http://paulgraham.com/wealth.html) \- in
particular "the pie fallacy".

You might be referring to the 'rivalry' of goods:
[https://en.wikipedia.org/wiki/Rivalry_(economics)](https://en.wikipedia.org/wiki/Rivalry_\(economics\))
\- but that's for one good at one time, not for the economy as a whole.

~~~
jsprogrammer
Transplanting an apple tree doesn't add more apples, it just produces apples
somewhere else. Planting apple seeds doesn't really produce more apples
either, you need to have an already available tree that you can graft apple
tree cuttings onto.

Even if you do get a brand new apple tree, it still takes some amount of time
(at least a year, though likely much more) before you get any additional
apples. So, the game 15 years from now may have more apples available, but the
current game has a finite amount of apples available to the participants.

~~~
davidw
I don't think you understand what it means in the sense of economics then.

It is not "all the available goods in one precise instant of time". It's how
people interact in the economy over time.

Compare and contrast the creation of an apple orchard with, say, going on a
raid to the neighboring village's apple orchard, stealing all their apples,
and cutting down all their trees. That's a negative-sum game. Looking at the
entire economy, everyone is poorer, even if the raiders temporarily get some
more apples. They haven't created any wealth, though; they've destroyed it.

Since labor is not instantaneous - planting a crop and waiting for it to grow
takes time - writing code takes time - building a car takes time - economists
talk about those interactions as non zero-sum. The total amount of goods at
any one instant in time is some other measure.

~~~
jsprogrammer
So, you are saying that even though the current game is zero-sum, at some
future point in time, we can consider it not zero-sum?

How does this not violate several laws of conservation?

~~~
davidw
No, I'm saying you're very confused about the generally accepted meanings of
those terms in economics.

The very meaning of 'game' implies one or more moves by each player.

A photo of a chess board does not a chess game make, in other words.

> How does this not violate several laws of conservation?

That's physics, not economics. We're not talking about the total mass or
energy or something in a system. Physics does not care if an apple tree
produces apples for people to eat; people do.

~~~
jsprogrammer
Did economics somehow escape physics? The economy is exactly the transference
of mass and energy in a system. The size of the game may increase over time,
but that doesn't mean the sum of all transactions is not still 0.

Maybe you could supply a definition of what you are talking about?

------
RobertoG
This is part of what Modern Monetary Theory has been explaining but it's
always hidden in the public discourse.

The consequences of what money is in modern economies, are not well understood
or accepted. I suspect that the possibilities that this open scare a lot of
powerful people.

If somebody want to dig further in the rabbit hole, I recommend:

[http://moslereconomics.com/wp-
content/powerpoints/7DIF.pdf](http://moslereconomics.com/wp-
content/powerpoints/7DIF.pdf) (this one is a pdf)

[http://neweconomicperspectives.org/modern-monetary-theory-
pr...](http://neweconomicperspectives.org/modern-monetary-theory-primer.html)

~~~
flurben
MMT is simultaneously

a) a "heterodox" theory that mainstream economists don't consider entirely
legitimate, and

b) precisely how central banks in the US and UK describe their own routine
monetary operations.

I still struggle to understand how and why these statements can both be true.

~~~
RobertoG
Yes. I also find that funny.

And MMT has another interesting property: when you take the time to learn a
little, it makes a lot of sense.

They have been always saying how money is really created, now the Bank of
England confirm it, but we should keep believing the text books from the gold
standard era I suppose.

~~~
bubbleRefuge
Its because unfortunately politicians and the financial press cannot touch it.
Its too easy for the public to draw comparisons between household budget
constraints and currency issuer budget constraints (which need not exist). FUD
sells.

------
drostie
So if you've never taken an economics class, here's the basic craziness that
crucially underpins our modern economy:

There is a central bank sitting in the middle of most modern economies, and it
is a bank-for-banks: they either borrow from it or deposit into it. It sets an
all-important interest rate: this rate is the rate-of-return that those other
banks will compare possible loans to, when saying 'is it worth it to loan to
this person, or should I just put my money in the central bank?' \-- if you
lower this rate, then presumably banks make more loans, stimulating the
economy; if you raise this rate, then presumably banks make fewer, stifling
the economy. The hope is not that different from storing up food in years of
plenty in order to weather years of famine; during a recession you lower the
interest rate, but afterwards in the upswing you raise it again.

When you deposit money in a bank, it is not required to hold onto all of it
and keep it safe. Instead it usually takes a chunk of that money and promises
it as a loan to someone else, who will hopefully in the end pay them more in
interest than they're paying you, enough more that the difference is better
than just shoving the money in the central bank.

When it makes this loan, that comes in the form of saying "I still owe you $x,
and now I also owe this other person $y." So the true money stored by the bank
is still only $x, but the money now in circulation in the economy -- in the
sense that there's the illusion of people having it, _which is the only sense
that money exists anyway_ \-- is $x + $y. If that other person needs to
immediately cash out a quantity of dollar bills, then $y < $x, so the bank can
comfortably do that. If you both try to cash out at the same time, there is an
obvious problem (the bank has failed!), but remember that this is a sort of
insurance scheme of "divide that risk among lots of people and trust that
their decisions follow a binomial distribution" \-- in reality there is some
proportion p of a lot of individuals who collectively need to withdraw in
order for the bank to fail. Furthermore when this happens the federal
government may declare the bank "too big to fail" and funnel tax money into
it, to keep it going.

This PDF is arguing that the above explanation is precise in ways that many
economics textbooks are loose; notice that the extra value has nothing, for
example, to do with _your putting the money into the bank_. Why? Because
suppose you spent that on a new car: your car dealership that you're buying
from has an account with this bank (or some other bank; the economy
collectively includes all of them after all) and they take this amount of
money and put it in the bank! So that $x is getting deposited somewhere,
assuming that you do not take it out of circulation yourself (in which case,
it doesn't help mediate your purchasing of goods and services, so is it
_really_ money?). Modern textbooks omit this and refer instead to the banks as
a "money multiplier" where "there is $100 deposited at first, the bank saves
20% of its deposits, it loans out $80 which gets immediately spent hence re-
deposited in some similar bank, so that bank saves $16 and loans out $64 which
similarly gets re-deposited, saving $13 and loaning out $51, at this point the
economy has nominally $100 + $80 + $64 + $51 = $295, so we've multiplied the
amount of money deposited into the economy by a factor of ~3x, and if you
continue the progression out to infinity you find that this multiplier
approaches 1/(20%) = 1/0.2 = 5." The problem with this thinking is that
there's nobody in the economy who comes into this system at that crucial step
0 -- you got your money from the bank account of your employer or from a loan
from some other bank. So, from your perspective, there's kind of nothing to
multiply.

If that makes you feel breathlessly like everything is an illusion resting on
an insane Ponzi scheme, that's mostly correct and you should feel all of that.
You can spend hours thinking about "what _is_ money, I mean _really_?" and if
you're a founder-mentality you might even spend years on this wondering if
there's an opportunity for disruption at an epic scale somewhere therein.

Probably the best way to understand money is still the engineer's, "I do
something that someone finds useful, so they give me points in this augmented-
reality game where the rules force them to give those points out of their own
personal stash. As long as we collectively agree that useful things are
happening, those points have some form of meaning as a way to symbolically
trade hypothetical goods and services. When we lose this collective confidence
then the points will no longer matter to us."

~~~
mtanski
> Probably the best way to understand money is still the engineer's, "I do
> something that someone finds useful, so they give me points in this
> augmented-reality game where the rules force them to give those points out
> of their own personal stash. As long as we collectively agree that useful
> things are happening, those points have some form of meaning as a way to
> symbolically trade hypothetical goods and services. When we lose this
> collective confidence then the points will no longer matter to us."

Money is essentially a distributed IOU. It enables people to trade goods and
services for IOUs. The IOUs are then exchangeable for other good and services
at a later time. Obviously there's more complications then that but that's the
general thing.

Like if write code for a living and want a taco, the taco vendor doesn't want
your code. Instead you sell your services (labor) to somebody who values that
who gives you IOUs in return. Then you take those IOUs and you cash them for a
taco or you can combine them with other IOUs you already have for bigger items
like a car or a house.

Then you can do all sorts of abstract things with your IOUs such as hold onto
them, or lend them out (to somebody who needs a bunch of IOUs at a time and
will pay them back slowly) or convert them to other kinds of synthetic IOUs
(stocks). Then later on these other kinds of IOUs get covered/replayed back as
money IOUs that you go buy your other tacos with.

And lets not even get to IOU appreciation or deflation.

~~~
sorokod
> Money is essentially a distributed IOU

Isn't this completely circular? If money is IOU, what is it that is being
Owned?

~~~
mtanski
Circular and self reinforcing. Why does anything have value, because people
believe it does ("Backed by the full faith and credit of the United States").

If you step back a bit to the meta IOU level. There's a fixed (but changing
all the time) amount of IOUs in circulation... and since you can transfer IOUs
you end up with ownership.

You can get more meta here, and say what is ownership? Ownership is really not
a natural / physical law. Instead it's a series of laws and social conversion
that we created and agreed upon. Why our brains made us do that is prob a good
question of evolutionary biologist who study primates (since some can be
thought to use money).

------
smaddox
For those interested in this topic, I highly recommend:

1) Steve Keen's blog \-
[http://debtdeflation.com/blogs/](http://debtdeflation.com/blogs/)

2) Debt: the first 5000 years \-
[https://en.m.wikipedia.org/wiki/Debt:_The_First_5000_Years](https://en.m.wikipedia.org/wiki/Debt:_The_First_5000_Years)

------
green_spun
Ray Dalio's "How the Economic Machine Works in 30 Minutes"
[https://www.youtube.com/watch?v=PHe0bXAIuk0](https://www.youtube.com/watch?v=PHe0bXAIuk0)
is a worthy 30 minute investment...

------
sedeki
How does this differ from the explanation given in the Zeitgeist movie?

~~~
aklein
The movie suggests that the central government directly manufactures an
initial amount of money to be put into circulation by issuing debt that is
bought by the central bank. The proceeds are deposited at commercial banks,
who then lend money out to the maximum extent allowed under fractional bank
lending requirements.

This paper argues that in reality, the relationship is exactly the reverse:
most money (=debt) creation starts as loans between private commercial banks.
Loans become deposits in other bank accounts. If a bank finds itself short on
a reserve requirement, it can just borrow reserves from other banks to meet
its reserves, or from the central bank.

In sum, at least in the United States and England, most money creation stems
from loans within the private sector, as opposed to what the movie and
textbooks typically suggest.

This is explained in the paper:

" For the [money multiplier] theory to hold, the amount of reserves must be a
binding constraint on lending, and the central bank must directly determine
the amount of reserves. While the money multiplier theory can be a useful way
of introducing money and banking in economic textbooks, it is not an accurate
description of how money is created in reality. Rather than controlling the
quantity of reserves, central banks today typically implement monetary policy
by setting the price of reserves — that is, interest rates. In reality,
neither are reserves a binding constraint on lending, nor does the central
bank fix the amount of reserves that are available. As with the relationship
between deposits and loans, the relationship between reserves and loans
typically operates in the reverse way to that described in some economics
textbooks. Banks first decide how much to lend depending on the profitable
lending opportunities available to them — which will, crucially, depend on the
interest rate set by the Bank of England. It is these lending decisions that
determine how many bank deposits are created by the banking system. The amount
of bank deposits in turn influences how much central bank money banks want to
hold in reserve (to meet withdrawals by the public, make payments to other
banks, or meet regulatory liquidity requirements), which is then, in normal
times, supplied on demand by the Bank of England. The rest of this article
discusses these practices in more detail."

~~~
branchless
and most of that lending (money creation) is against land, not businesses. UK:
[http://bsd.wpengine.com/wp-
content/uploads/2013/05/Sectoral-...](http://bsd.wpengine.com/wp-
content/uploads/2013/05/Sectoral-Lending.png)

------
zaro
Ok, so even Bank of England confirms the current money system is a big Ponzi
scheme type of scam. But since everyone is in the scheme the topic of "why do
we keep tolerating this?" never comes up.

~~~
agumonkey
A closed ponzi-scheme looks like a fair description of an economy.

------
Sealy
Right here is a pdf on why you should consider owning an asset such as
Bitcoin. I'm not saying everyone should go all in, just consider owning it as
part of your investment portfolio...

------
solotronics
Do you find yourself disenchanted with the current system of Central banks and
government backed Fiat currency? Do you ever ask what will happen as we create
money at an unprecedented velocity with unknown consequences?

Research bitcoin. Bitcoin is to money as bittorrent is to downloading files.
It is a decentralized trustless system built on cryptology and it is
absolutely beautiful.

~~~
Mikeb85
Except for the fact it has a tendency to concentrate wealth by design, the
exact opposite of what you want in fiat currency.

~~~
Natanael_L
And inflation doesn't, when new money primarily goes to the few closest to the
mint?

With deflation, you have to work harder to expand your share of the economy.
Just holding doesn't contribute to the economy and thus means an already large
held share is less likely to grow in value relative to the desired goods.

~~~
Mikeb85
> With deflation, you have to work harder to expand your share of the economy.
> Just holding doesn't contribute to the economy and thus means an already
> large held share is less likely to grow in value relative to the desired
> goods.

Deflation literally increases the value of already-held cash (when prices go
down, cash becomes more valuable). Deflation literally encourages hoarding,
this is probably the one single tenet of economics that no one disputes.

> And inflation doesn't, when new money primarily goes to the few closest to
> the mint?

Inflation decreases the value of cash, so it encourages spending.

New money is issued when the central bank buys securities on the open market -
usually from the government, sometimes from banks and businesses.
Theoretically they can lend to whomever, but because of arbitrage (if the
centra bank offers debt at 0.25%, interbank lending rate will fall/rise to
that level, because if banks offered worse rates, lenders/borrowers would just
go to the central bank) it winds up not mattering who they lend to.

They don't just wheel piles of cash to the nearest bank for them to hoard and
pay CEOs with...

Anyhow, wiki article:
[https://en.wikipedia.org/wiki/Central_bank#Currency_issuance](https://en.wikipedia.org/wiki/Central_bank#Currency_issuance)

And there's plenty of other material online.

~~~
Natanael_L
And then everybody with a lot of money holds... And now what? Now the
miniscule active share of the economy dictates the value of your holdings.
You're thinking short term only. There's no deflation to be had with a
shrinking economy.

There's an equilibrium here, one that's _past_ the point of hoarding for large
players. If you can move the economy all by yourself, you do not want the risk
of letting the economy moving on without you. Money sitting still does no good
by itself.

After all, what's the point of value you can't touch? There's no value in
that...

With inflation, you can grow your share of the economy from your position
alone (increasing both value and "rank"). Deflation point allows your value to
passively increase, not your share of the economy.

And who is capable of performing arbitrage? Average Joe? Nope, inflation feeds
people like on Wall Street since they get to spend the new money long before
workers get their salary increases (after they feel effect of inflation on
their expenses!).

~~~
Mikeb85
> There's no deflation to be had with a shrinking economy.

Deflation almost always accompanies economic downturns. It's literally defined
as a decrease in prices, which is caused by a lack of demand. A recession is
literally a reduction in economic activity. They go together by definition.

[https://en.wikipedia.org/wiki/Deflation#Deflationary_spiral](https://en.wikipedia.org/wiki/Deflation#Deflationary_spiral)

Of course, that's a fairy simply definition, you can have inflation in a
downturn when your currency devaluates, and the price of imported goods go up,
which is a problem if you import too much. But the value of domestic assets is
still going down, so measuring inflation/deflation does depend somewhat on
what exactly you're measuring.

> With inflation, you can grow your share of the economy from your position
> alone

If you own assets you benefit from inflation. If you have cash, you lose from
inflation.

If you only have $1000, and the price of a business goes from $500-$1000
(inflation), you go from being able to buy 2, to only buying one. Cash loses.

If the price deflates from $500-$100, you go from being able to buy 2 to
buying 10. In the deflationary scenario, cash wins.

If you already own a business, it's easier to guess which is better. You want
the price to go up.

> Nope, inflation feeds people like on Wall Street since they get to spend the
> new money long before workers get their salary increases (after they feel
> effect of inflation on their expenses!).

You literally didn't read any information that I posted, did you? Central
banks don't lend to banks to pay their bills or CEOs. They buy securities that
are backed by real assets, and they generally prefer buying government bonds.

> And who is capable of performing arbitrage? Average Joe?

In this particular case, arbitrage is simply deciding who you're going to
borrow from. If bank A offers a mortgage for 5%, and bank B for 6%, which loan
are you going to take? This creates an incentive for both banks to lower their
rate until a point where it's no longer profitable (ie. the rate that they're
borrowing at). This is obviously a simplistic example, but should illustrate
the point.

On a macro scale, if the central bank offers loans at a certain rate, then
other banks will match that rate, otherwise they lose business.

~~~
Natanael_L
> it's literally defined as a decrease in prices, which is caused by a lack of
> demand.

Correlation ≠ causation.

In particular when practically every occurrence of deflation + a bad economy
followed a crash in an economy built on debt. Have you considered that just
like withdrawal symptoms, it isn't necessarily deflation that's the bad thing?

If you have government contracts and buy assets using effectively subsidized
money, your assets and value both grow in absolute numbers. You're buying with
fresh money _before_ it has been matched by a price signal in the economy,
only _then_ raising the price.

With deflation only value grows, and only for as long as the economy stays
alive.

How does printed money enter the economy if it isn't used to buy anything? And
the printers don't buy from everybody equally. Value is shifted from the
entire society to those closest to the printers.

And people not in a position to chose between loans or take any loans at all?
I.e. below middle class?

~~~
Mikeb85
> In particular when practically every occurrence of deflation + a bad economy
> followed a crash in an economy built on debt. Have you considered that just
> like withdrawal symptoms, it isn't necessarily deflation that's the bad
> thing?

A decrease in prices spurs demand so it can be a good thing.

However, in the context of currency, you don't want the currency itself to
have deflationary mechanisms. In bitcoin's case, there's an ever-increasing
cost to mining the bitcoins. This means the value will naturally increase.
Which discourages any sort of spending.

The reason why a money supply that never increases is bad, is because human
populations do increase. If more humans demand the same quantity of money,
then those with money have the incentive to never spend. This negatively
impacts the economy.

This is why in any downturn, the central bank response to deflation is to
increase the money supply. By making money cheaper, they're encouraging people
to take advantage of cheaper asset prices. This in turn, spurs demand.

> If you have government contracts and buy assets using effectively subsidized
> money, your assets and value both grow in absolute numbers.

You're forgetting that the borrower owes money.

> How does printed money enter the economy if it isn't used to buy anything?

Of course it's used to buy things. No one takes out loans to simply hoard
money, because there's a cost to the loan (and the cost of the loan will
always be more than the cost of a no-risk asset).

> Value is shifted from the entire society to those closest to the printers.

This is conspiracy thinking at it's finest. No one gets 'free' money. It all
has to be paid back at some point.

Value goes to those who engage in constructive activities. Loans are a way to
shift unused capital to constructive activities.

And no, no one has to take out a loan. You can accrue capital in other ways.
However the lending system makes the whole economy more efficient.

~~~
EdHominem
> This is why in any downturn, the central bank response to deflation is to
> increase the money supply. By making money cheaper, they're encouraging
> people to take advantage of cheaper asset prices. This in turn, spurs
> demand.

This ignores the astronomical losses from our fractional banking system.
Pretty much every 40 years we get a crash and print our way out of it, giving
ever more money to the core of the system. (Trickle-down, or too-big-to-fail,
both were rewards simply for being the entrenched players.) The USD has lost
95% of its value. Perhaps for the "economy" (... of bankers who defraud us)
inflation is good, but for the common man fraud is worse and fiat is the
enabler, not the solution.

Sure, there's _a_ problem having a fiat system is good for but there's a huge
gulf between "Fixes problem X" and "Performs better across all scenarios".

~~~
Mikeb85
> This ignores the astronomical losses from our fractional banking system.
> Pretty much every 40 years we get a crash and print our way out of it,
> giving ever more money to the core of the system.

Take a look at some very long term (100 year) GDP charts. The economy is far
less volatile today than ever before.

While there are culprits, the fractional banking system isn't necessarily one.

> Trickle-down, or too-big-to-fail, both were rewards simply for being the
> entrenched players.

These are the results of a corrupt system, not because of the existence of
fiat currency or central banks.

> The USD has lost 95% of its value.

And you make 20 times more of it.

> Perhaps for the "economy" (... of bankers who defraud us) inflation is good,
> but for the common man fraud is worse and fiat is the enabler, not the
> solution.

Please, there was theft and fraud when we were trading piles of grain and
goats.

~~~
EdHominem
> These are the results of a corrupt system, not because of the existence of
> fiat currency or central banks.

Without the ability to print money we wouldn't have to wish for a unicorn - a
non-corrupt system.

The banking/mortgage problem in 2008 only happened because everyone involved
knew we'd bail them out, because we could. Whereas if we couldn't we'd have
recovered the lost funds from the guilty parties.

The existence of an easy out practically guarantees that the government will
take it.

> And you make 20 times more of it.

And what you had from before is nearly worthless. Yes, inflation keeps people
on their toes because they need to work today to eat today, but I'd keep you
on your toes if I stole your car too, you'd have to really be productive to
break even!

That's a broken window fallacy with the twist of slightly breaking everyone's
window.

As a currency, fiat is an absolutely stupid idea. So stupid that they had to
make specie ownership illegal to force people to play along. Yes, I understand
it gives the country great options. But so does conscription...

> Please, there was theft and fraud when we were trading piles of grain and
> goats.

Only fiat inflation lets a thief steal from _everyone_ simultaneously. And
thanks, but that's not really an answer anyways. I don't care that someone is
always _willing_ to steal from me, I care when the law says I can't attempt to
avoid it.

