Post by Iain Dooley on Aug 14, 2016 12:31:32 GMT
In his macro series, lectures 6&7, Randall Wray talks about banking and finance sector reform:
www.youtube.com/watch?v=ZIsV7kXHN1c&list=PLkKoAQeawlO64sZ7KuRp21luMaUM63guo
There are all sorts of logical conclusions about how banks should be structured that stem from the simple fact that all banks require federal deposit insurance/guarantees to avoid bank runs, so therefore it's logical to assume that vast amounts of the banking system are already nationalised and we shouldn't really be subsidising massive private sector profits through that system.
Most interestingly, though he starts with the question: What is a financial system for? This discussion is based on the work of Minsky and gives rise to a model where we have a government savings system (why we have Super Annuation in this country is beyond me) and even a government payments system.
Again this plays nice with the idea of "natural monopolies" and the public purpose.
Mosler's core tenet of financial regulation is that currently we tell the banks what they CAN'T do but should instead tell the banks what they CAN do, that is "white listing" instead of "black listing" behaviour. This is more in line with how we regulate pharmaceuticals.
Right now, finance/banking companies can more easily look for loopholes and until they are expressly forbidden from doing something, this makes it legal to do it. This would be a more effective tool than, say, a royal commission which is a bit of a toothless tiger.
www.youtube.com/watch?v=ZIsV7kXHN1c&list=PLkKoAQeawlO64sZ7KuRp21luMaUM63guo
There are all sorts of logical conclusions about how banks should be structured that stem from the simple fact that all banks require federal deposit insurance/guarantees to avoid bank runs, so therefore it's logical to assume that vast amounts of the banking system are already nationalised and we shouldn't really be subsidising massive private sector profits through that system.
Most interestingly, though he starts with the question: What is a financial system for? This discussion is based on the work of Minsky and gives rise to a model where we have a government savings system (why we have Super Annuation in this country is beyond me) and even a government payments system.
Again this plays nice with the idea of "natural monopolies" and the public purpose.
Mosler's core tenet of financial regulation is that currently we tell the banks what they CAN'T do but should instead tell the banks what they CAN do, that is "white listing" instead of "black listing" behaviour. This is more in line with how we regulate pharmaceuticals.
Right now, finance/banking companies can more easily look for loopholes and until they are expressly forbidden from doing something, this makes it legal to do it. This would be a more effective tool than, say, a royal commission which is a bit of a toothless tiger.
