What do you think is the future of money? Fractional reserve banking is absolutely necessary for banks to operate. A bank makes money by accepting deposits and loaning most of it out at a higher interest rate. It is not possible for a bank to hold it all in reserve in case everyone wants to withdraw all their money all at the same time. After that happened in 1929, the US licensed the FDIC (a private corporation) to insure banks against runs. But the FDIC does not have enough reserves to protect all the banks at one time, like what happened in 1929. The reason it hasn't happened again since then is partly the FDIC restoring some confidence in banks, partly luck, and partly that the government could and probably would bail out the banks (like in 2008) by printing money. That would not be an option if money was backed by gold and silver, like it was in 1929.
I say luck, because markets are intrinsically random. If there was an algorithm for predicting prices, then everyone would use it. Obviously this is not possible in a zero sum game. Therefore no such algorithm exists. But markets can only exist when they has members who think they are smarter than the market as a whole. The only difference between today and the market crash of 1929 or the tulip bulb crash of 1637 is that panic was limited by the speed of human communication. Now it is only limited by the speed of light. Fortunately, market crashes don't affect economic growth, which is driven by technology, not by the luck of gamblers trading stocks or crypto. For the rest of us, all that matters is production. The future of money is not cash, not gold, and not crypto. Governments are banning or tightly regulating crypto because it is mostly used for something illegal, like buying drugs or stolen data or paying ransom or bribing corrupt officials. (Trump holds 80% of 1 billion $TRUMP coins at $2.86 each). People want the banks to monitor all their financial transactions, and are even willing to pay 3%, in exchange for protection against fraud. In a future without war, borders, poverty, or prisons, this is the only way that money can work. Aligned AI requires human knowledge, and the only practical way to collect it is a system of mass surveillance. -- Matt Mahoney, [email protected] On Fri, Mar 27, 2026, 4:47 PM John Rose via AGI <[email protected]> wrote: > On Friday, March 27, 2026, at 11:11 AM, Matt Mahoney wrote: > > Yes, I get that the US Federal Reserve and Bank of England, etc. are > privately owned banks licensed by their governments to print money. But so > are other corporations, except that the money takes the form of stocks and > bonds. All money is debt. When I loan you a dollar, we both have a dollar. > > > When you deposit a dollar into your bank account you are legally giving > the bank a loan, it becomes their money. The bank can then lend out $9 > created electronically since the reserve requirement is 10%. Most people > think that the bank is lending out depositor savings. That's a small piece > of the dilution issue, the more dollars created devalues existing dollars. > Similar action with credit cards... If you lent someone a dollar in 1913 > when the Fed was created it has lost roughly 97% of it’s purchasing power > or 99% compared to gold even though it’s still a dollar. The Fed aims for > 2% inflation, which is currently much higher, but even at that, you’re > loosing purchasing power rapidly due to new dollars created. This money > creation with derivatives results in all sorts of distortions in the system > to where it becomes detached from basic economic reality. Currently there > are multiple quadrillions of dollars in derivatives. The AI boom, through > this and related means has created an exorbitant amount of new dollars to > the point where it is has in many ways has just become a spend on anything > as fast as you can frenzy with piles of derivatives on top of that. This > money creation results in wealth concentration for those closer to it. > > The fiat system is tightly coupled with the legal system and it has been > setup over the years preparing for an eventual cyclical collapse and reset. > In a collapse entities go bankrupt, equities get pooled and ownership of > assets is taken via collateralization. David Rogers Webb has written on > that. Other systems are tightly coupled, medical, education, food, military > and these are manipulated via money creation dynamics. Currently the system > is moving into digital programmable stablecoins and a surveillance state > without reform and this is going to make the value exploitation, > omni-financialization and economic distortions even more inescapable and > pervasive especially with integrated sovereign centralized AI. Just like > detailed in “The Money Masters” the controlling entities make their moves > behind the scenes. And as evidenced with the recent partial release of the > Epstein files you get a glimpse of who these beings are and how they > operate if one thinks a new digital AI monetary control grid needn’t be > deeply reviewed, examined and potentially voted on. In a truly free society > a system like this would not be forcefully imposed and required without > viable alternatives. > > *Artificial General Intelligence List <https://agi.topicbox.com/latest>* > / AGI / see discussions <https://agi.topicbox.com/groups/agi> + > participants <https://agi.topicbox.com/groups/agi/members> + > delivery options <https://agi.topicbox.com/groups/agi/subscription> > Permalink > <https://agi.topicbox.com/groups/agi/Tc2616dc0a8577813-M6514d5356c8c0dd4b6e15a53> > ------------------------------------------ Artificial General Intelligence List: AGI Permalink: https://agi.topicbox.com/groups/agi/Tc2616dc0a8577813-M4065f815ce58aa5b3390c013 Delivery options: https://agi.topicbox.com/groups/agi/subscription
