Are there any 100% reserve banks in existence?

D

danda

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May 16, 2007
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If not, could we start our own 100% reserve bank to compete with the fraudster banks?

This is a serious question.

How would such a bank operate? Clearly, it would have to charge fees for storage, debit cards, etc. And I doubt it could pay any interest.

So, is it impossible for such a bank to compete with those that can lend out 90% ( or soon 100%?!!) of their deposits. Are there legal or regulatory hurdles?

Does such a bank exist? Has it been tried in recent times?

I am thinking that perhaps some of the pre-paid debit card services may be pretty close to this. Or maybe GoldMoney, etc...
 
With zero interest there would be no point.

Just buy gold coins and keep them under your matress. Or even better, in your gun safe. Then, you AT LEAST keep up with inflation. Whereas if you just keep dollar bills, in 10 years it won't be worth shit anyway.
 
There are reasons why 100% reserve banks don't exist.

1. They can't compete with services fractional reserved banks offer
2. They cannot lend out money, which takes away too much revenue
3. They can't operate unless they charge depositors a fee, or a high interest rate for those who loan.

So a better alternative to fully reserved banking would be investment in commodities or online trading. In real life, you can't operate an office without at least $100 in electricity a day, $10,000 in employee salary and $5000 in rent a month. It's unrealistic and harsh to be a responsible businessman in a world of highly regulated trade.
 
There are 100% reserve banks Josh. www.GoldMoney.com is one of them. They make money the old fashioned way. I guess I should say there is at least one. To be sure I don't know if there are others.
 
AndyWhite said:
There are 100% reserve banks Josh. www.GoldMoney.com is one of them. They make money the old fashioned way. I guess I should say there is at least one. To be sure I don't know if there are others.
Click to expand...

Not arguing with you at all.

Like I said, the alternative to that would be exactly what GoldMoney is, invested in commodities or traded online.
 
Iranian banks, from what I understand, are also 100% reserve. Read a long article on it once.

Not very useful to us, but interesting to note since our 'leaders' hate them so much!
 
Dequeant said:
With zero interest there would be no point.

Just buy gold coins and keep them under your matress. Or even better, in your gun safe. Then, you AT LEAST keep up with inflation. Whereas if you just keep dollar bills, in 10 years it won't be worth shit anyway.
Click to expand...

There's still a point. It's not about interest. It is primarily about paying someone to protect your money. You also get checks.

You cant guard your gold coins in your bedroom 24/7
 
brandonyates said:
There's still a point. It's not about interest. It is primarily about paying someone to protect your money. You also get checks.

You cant guard your gold coins in your bedroom 24/7
Click to expand...
yes, you can't guard your gold 24/7 , but if your bank is online, you can't run with it either (or if you've lost communications with the internet).
 
danda said:
If not, could we start our own 100% reserve bank to compete with the fraudster banks?

This is a serious question.

How would such a bank operate? Clearly, it would have to charge fees for storage, debit cards, etc. And I doubt it could pay any interest.

So, is it impossible for such a bank to compete with those that can lend out 90% ( or soon 100%?!!) of their deposits. Are there legal or regulatory hurdles?

Does such a bank exist? Has it been tried in recent times?

I am thinking that perhaps some of the pre-paid debit card services may be pretty close to this. Or maybe GoldMoney, etc...
Click to expand...

Sure it could pay interest.

Banking 101
The bank would loan your money out and the interest paid on the loan would go to you. The bank would take a portion for being a facilitator.

If the bank wants your business they know that they have to guarantee as much as possible that your money will be repaid by the borrower so they are really going to scrutinize the credit worthiness of the borrower.

When there is more money in reserves than is being loaned out, the interest rate drops which encourages borrowing. When there is more money being loaned out than are in reserves, the interest rate rises which encourages savings.

The bank would get a private insurer in case something happens to the money. Since the bank wants the insurance premiums to be as low as possible, they would have the best possible safeguards to protect your money.

All of this is done with real savings from real wealth and without any kind of government or central bank intervention.
 
credit and lending does exist in 100% reserve banking, interest rates are a lot higher, savings accounts will usally have holding periods and minimum deposit requirements

although the other two points as to why they can't exist in the current US are correct.

Until an end to the fed, 100% reserve can't survive.

100% reserve banking can exist and thrive, but the current interventionist enviroment doesn't allow it.
 
You can still make loans in a 100% reserve bank. You just use your own money instead of other people's money ore creating new money. And you can still charge interest on it. That has nothing to do with being 100% reserve. It is no different from me loaning my friend $10 today and getting my $10 plus an extra dime tomorrow. No new money was created and I didn't steal from someone else. Plus they can always change a small fee to protect your money from theft.
 
Ya'll need to go read "What has government done to our money"... or forever remain in ignorance. Your choice. ;)
 
Hmmm

If this existed I would want to be a member there. Especially if it was run by liberty supporters. I've been looking at GoldMoney.com too.

There's so much creativity and real action coming out of this movement. I'm so glad to be a part of it.
 
How does a 100% reserve requirement allow a bank to make a loan since the loan would reduce reserves below 100%?

All deposits would be available for withdrawal all the time. That's what 100% reserves means. I'm sure such a bank could exist. It would be very safe for depositors, but not very profitable for the shareholders of the bank. Income sources would be monthly fees and they wouldn't be able to pay depositors any interest since they are not re-investing the money in the economy. The funds are essentially dead and earn no money for anyone.

Fractional reserve banking is a problem, but only when the reserve requirement is at immoral levels like below 15%. It could be raised to 50% and things would be fine. As with many aspects of capitalism, there is a wild animal that needs to be tamed for the good of humanity. It should not be killed, only contained within appropriate boundaries.
 
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