Thursday, 9 May 2013

Conference “Fixing the Banking System for Good” – Video

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A very interesting conference took place on 17th April 2013 in Philadelphia, USA.  Big senior figures in the economic, monetary, and financial worlds, including Adair Turner, Laurence Kotlikoff, Michael Kumhof and Jeffrey Sachs were discussing fundamental solutions to current global monetary and banking problems.
This was probably the first conference ever where the top academics were seriously discussing ending fractional reserve banking.


Michael Kumhof, Deputy Division Chief, Modeling Unit, Research Department, International Monetary Fund, explained in very clear and straightforward way how exactly banks work and presented the Chicago Plan proposal.
“The key function of banks is money creation, not intermediation. And if you tell that to a mainstream economist, that’s already provocative, even though it’s hundred percent correct.”
His presentation starts at 1:02:12
The slides of his presentation are here: The Chicago Plan Revisited

Adair Turner, Former Chairman of the UK Financial Services Authority and Senior Fellow at the Institute for New Economic Thinking, gave a noteworthy presentation on “Money and Debt: Radical Solutions to the Challenge of Deleveraging”
“Fractional reserve banks create whole new level of danger. Because the fundamental fact is, that when people say  ”banks take savings and intermediate it to loans” – that’s not true.
One of the most fundamental insight is that banks simultaneously create new credit and new money ex nihilo.
And that is one of the most fundamental, important things for people to be taught, which economics undergraduates should be taught about the nature of how monetary economy with banks works.”
His presentation starts at 4:06:07

Laurence Kotlikoff, William Fairfield Warren Distinguished Professor at Boston University, on Limited Purpose Banking
His presentation starts at 1:49:42

Jeffrey Sachs, Director of The Earth Institute, Quetelet Professor of Sustainable Development and Professor of Health Policy and Management at Columbia University, on Implications for Global Development 
“Could we really have liquidity without fractional reserve banking? If we could, we might be able to address another degree of this problem.”
His presentation starts at 2:35:08

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