What are banks for?

Radiantsoul

reduceditem wrote: »

would it be better to nationalise them all and change the way they function?

No.
The economic benefits of the banking sector have been massive.
Stock markets and banks are responsible for much of the capital formation of our society; office blocks, factories, houses, shops, restaurants, etc.
I can't see how they could have been created by a government simply nominating where funds go and it seems to have failed whenever it has been tried.

It is the case that some banks probably should be nationalised but that is more about ensuring governments are left holding the risks without the reward. Nationalised banks should be sold back to the private sector as soon as it is practical.

treliac

Cleaver wrote: »

Depends who you ask: ............

Cleaver, you're so perceptive, you really should be a psychic. :A

bluey890

Cleaver wrote: »

Depends who you ask:

Cleaver / mewbie: "It's the function on The Weakest Link for keeping money safe for the next round. Chortle, chortle."

amcluesent: "It's a pointless question. The masses have had their noses in the financial trough for too long, aided by Clown and Darling, which will destroy all banks by this time next year."

Dervish: "they are wehre good peopel go to do there BANKING. Immigrents are runining them all thouhg."

Generali: "A bank is a financial institution whose primary activity is to act as a payment for customers and to borrow and lend money. It is an institution for receiving, keeping, and lending money in hopes of repayment." ('cos he's always right).

mr.broderick: "banks? who cares. Have you seen my sock puppet picture? wanna buy a volvo sir?"

StevieJ: "It's a place to lend money of course!

ad44downey: "Clown has runied all of our banks, I don't expect them to last."

Donaldtramp: "I think the public sector could look towards the banks as a way to operate their pension systems. In fact, I think the public sector pension system could be to blame for the downfall of the banks."

Dopester: "Doesn't matter what a bank does as you're not going to need one when you're living in the back of a burnt out car, fending for yourself with a shotgun."

PasturesNew: "Bank? I haven't been to a bank since 1972. And then it was just a visit to pay in a bag of coppers. Don't use banks at all. Oh, there's a Tonight Special: Reposession Britain starting at 9pm. Bonus, didn't know it was on. Will do a commentary.

NeverDespairGirl: "......"

!!!!!!?: "......"

DitheringDad: "You want to know what a bank is? I think you're a sock puppet. In fact, I think you're Carolt's sock puppet. Or possibly Dans. Or chucky's. Or maybe !!!!!!?'s. Well, I'm not sure. But you're definately a sock puppet.

mitchaa: "A financial vehicle used to buy houses in Aberdeen that never go down in value."

sockpuppets: "Anyone want to join my sockpuppet 11?

cleaver - you either do good impersonations or u own a lot of socks.

mewbie_2

Quasar wrote: »

At least, that's what banks were started for. Then they became something else: a way for those running them to gamble OUR money (which they had in trust) to make more money for themselves.

First let me say "Cleaver excellent stuff".

Now back to this quote. Gambling with our money. What short memories we have. We gave / invested our money with banks and other institutions in the hope they would gamble / invest because we wanted the returns. We wanted the high returns from Icelandic banks. Some wanted higher returns from BTL.

But rich complaining that something too good to last has stopped isn't it?

reduceditem

Radiantsoul wrote: »

Banks transfer money from those who have surplus funds but nothing much to invest in to those who have good investment opportunities but no surplus funds.

That's what they used to do.

Now if you get a loan from a bank the funds are given to you out of thin air.

Radiantsoul

reduceditem wrote: »

That's what they used to do.

Now if you get a loan from a bank the funds are given to you out of thin air.

No that isn't true. Banks create credit and always have.
They are able to do this because they know that it is unlikely creditors will seek repayment at the same time.

reduceditem

Radiantsoul wrote: »

No that isn't true. Banks create credit and always have.
They are able to do this because they know that it is unlikely creditors will seek repayment at the same time.

It is true.

The premise on which banks 'create credit' is utterly different now to how they used to do it. It's unsustainable. It is a conjuring trick.

ninky_2

reduceditem wrote: »

It is true.

The premise on which banks 'create credit' is utterly different now to how they used to do it. It's unsustainable. It is a conjuring trick.

Agreed, the fractional reserve banking system is a big pyramid scheme. Once it reaches saturation point it can not longer continue.

I think we should bring back a National Bank like Giro Bank. It revolutionized the banking system and was run through the Post Office. It was sold off by the Tories to Alliance & Lester. I think the govt are looking into bringing back something similar.

Whether we should have several National Banks is questionable. It could be a little defeating to have them competing against each other.

Generali

ninky wrote: »

Agreed, the fractional reserve banking system is a big pyramid scheme. Once it reaches saturation point it can not longer continue.

I think we should bring back a National Bank like Giro Bank. It revolutionized the banking system and was run through the Post Office. It was sold off by the Tories to Alliance & Lester. I think the govt are looking into bringing back something similar.

Whether we should have several National Banks is questionable. It could be a little defeating to have them competing against each other.

Why would a monopolistic, state owned bank not use fractional reserve banking?

You realise that if your banking system came about you could only lend the money that is saved by people - the destruction of credit would be immense. House prices would fall by 90+%, agricultural production would plummet, Government spending would have to be slashed, imports and exports would all but cease and business would stop.

bubblesmoney

Quasar wrote: »

Well, I prefer to have a current account and savings rather than keep my cash under the mattress.

At least, that's what banks were started for. Then they became something else: a way for those running them to gamble OUR money (which they had in trust) to make more money for themselves.

When at last banks become properly regulated the way they used to be, they will fullfil their proper function again.

i think i am going dizzy. if my approx calculations are right, you seem to have posted about 50 posts a day every day for the last 3.7years! :eek:
you must have some tired fingers with all that typing. now its time to show this to my wife as proof that i dont spend too much time on the computer, hope she buys my excuse after she sees this