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Old 09-30-2008, 03:15 PM
 
Location: Santa Monica
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As I had feared, you are over 100 years behind in economics knowledge and probably 200+ years behind in accounting knowledge.
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Old 09-30-2008, 03:35 PM
 
Location: DFW, TX
2,935 posts, read 6,128,573 times
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Quote:
Originally Posted by ParkTwain View Post
As I had feared, you are over 100 years behind in economics knowledge and probably 200+ years behind in accounting knowledge.
And if you study Calculus, are you 400-500 years behind? Gimme a break.

You may disagree with certain economic theories, but to suggest that they are invalid because of the date in history when they were first theorized is ludicrious. But I'm beginning to learn that this is a common thread with you... argue not based upon merits, but rather upon baseless distractions.
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Old 09-30-2008, 03:44 PM
 
Location: Santa Monica
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Sorry that I'm too subtle for you.
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Old 09-30-2008, 04:16 PM
 
Location: Albemarle, NC
7,730 posts, read 12,718,411 times
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Quote:
Originally Posted by ParkTwain View Post
As I had feared, you are over 100 years behind in economics knowledge and probably 200+ years behind in accounting knowledge.
Care to point out where I am wrong? I'm open to being corrected here if my theory is wrong.
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Old 09-30-2008, 04:20 PM
 
3,912 posts, read 4,856,150 times
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I guess thats the reason they have ignore lists. What a DB.
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Old 09-30-2008, 04:23 PM
 
Location: Santa Monica
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An account receivable is accounted for as an asset. This is an old idea.

Fractional reserve banking is also an old idea. For it to work in practice without undue danger to a region's or nation's economy, there are regulations for banks to observe.

Neither of these is a controversial idea anymore, and each is actually beneficial to economic activity. Why are these ideas controversial for you?
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Old 09-30-2008, 04:32 PM
 
Location: Albemarle, NC
7,730 posts, read 12,718,411 times
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Quote:
Originally Posted by ParkTwain View Post
An account receivable is accounted for as an asset. This is an old idea.

Fractional reserve banking is also an old idea. For it to work in practice without undue danger to a region's or nation's economy, there are regulations for banks to observe.

Neither of these is a controversial idea anymore, and each is actually beneficial to economic activity. Why are these ideas controversial for you?
I pointed out that it is a generally accepted practice. IMO, it's not sustainable.

FRB also works (in practice lol) until the borrowers cannot pay their debts which they can't because there isn't enough money since interest is charged on those debts. There is only some much real money to repay them. Again, this isn't sustainable.
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Old 09-30-2008, 04:35 PM
 
Location: Santa Monica
4,708 posts, read 7,719,703 times
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Originally Posted by paperhouse View Post
I pointed out that it is a generally accepted practice. IMO, it's not sustainable.

FRB also works (in practice lol) until the borrowers cannot pay their debts which they can't because there isn't enough money since interest is charged on those debts. There is only some much real money to repay them. Again, this isn't sustainable.

You mean that a given bad loan isn't sustainable, which is true, and the bank writes it down or completely off its books as an asset and takes that as a loss. If a bank uses a "conservative" lending approach, it would take a deep economic downturn for so many of its loans to become nonperforming that the bank is no longer viable as a business. But that does happen in some places. This doesn't mean that fractional reserve banking is an inherently unsustainable practice. It has to be practiced subject to certain rules and with a dose of conservatism on the part of the bank.
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Old 09-30-2008, 04:44 PM
 
Location: DFW, TX
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Fractional reserve banking which is based upon, or backed by, faith alone is unsustainable.

I'm not opposed to the idea of fractional reserve banking altogether, as long as we have a method of basing the liquidity. Take the manipulation out of the market as much as possible and back the currency... faith alone isn't sufficient.
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Old 09-30-2008, 04:51 PM
 
Location: Albemarle, NC
7,730 posts, read 12,718,411 times
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Quote:
Originally Posted by ParkTwain View Post
You mean that a given bad loan isn't sustainable, which is true, and the bank writes it down or completely off its books as an asset and takes that as a loss. If a bank uses a "conservative" lending approach, it would take a deep economic downturn for so many of its loans to become nonperforming that the bank is no longer viable as a business. But that does happen in some places. This doesn't mean that fractional reserve banking is an inherently unsustainable practice. It has to be practiced subject to certain rules and with a dose of conservatism on the part of the bank.
I'll buy that for a dollar. At least until the system gets so large that it starts adjusting prices based on the availability of money. Still, most of these banks didn't use conservative lending so what now? Bail them out? None of the regulations that caused this are being changed.
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