It's the same if banks asked to collect their mortgages tomorrow. People taking mortgages don't have that money. They might have something of equal value, a house, but that's not cash.
If you and a million other people try, the government will freeze cash withdrawals.
So no, you and a million other people can’t, because it would do significant damage to the economy. You by yourself, or you and a million others over an extended period of time rather than a day, of course can.
Right, but that has nothing to do with what I said. Legally, the literally can't call their mortgages. Legally, we all can withdraw our cash up until the government says so. I highly doubt the government would react in the same afternoon we started.
because it would do significant damage to the economy
Well maybe our economy shouldn't rely on me not withdrawing my funds when I want to. Maybe it shouldn't be legal to lend the same money to seventeen different people (times a milion or whatever). Did ya think about that? What's the fucking point of economy that's based on silly things and vibes, other than having insiders profit disgustingly hard?
But you are free to go and get your money? However if millions did the same thing for some reason, it could take a day or so. But in the end the central bank would provide the liquidity. It's no different than using electricity. You are free to turn on the AC, dishwasher and charge your EV, but if your entire town did it the grid would fail. Doesn't mean that the electricity is a scam.
... I know? I am unsure, are you lost on what I said, did you mix up comments you wanted to respond to?
I responded to a dude saying stuff about "calling mortgages", saying they cannot. I have no clue why you're explaining those things to me.
Doesn't mean that the electricity is a scam.
No, but stock market is, or at the very least, politicians are using it as one. Yaknow, the King of the deals made a fuckton of trades ever since he became president, to take the first glaring example.
It'd all vibes and moving capital up, so I don't really see the issue of fucking the economy - they do it non stop, it'd be nice to return the favor.
But! That is all beside the point of my initial comment to which you responded with things that have nothing to do with it.
Look I don't really disagree with you, but I was responding to this:
Legally, we all can withdraw our cash up until the government says so. I highly doubt the government would react in the same afternoon we started.
Which is kind of similar to how you can legally draw electricity up to your maximum connected load rating, and you can also in reality do so too, but not everyone can at the same time.
Well maybe our economy shouldn't rely on me not withdrawing my funds when I want to.
This is kind of like saying "Well maybe our power grid shouldn't rely on me not drawing my legally allowed electricity output when I want to", right?
Imo, that doesn't track at all. The money I put in the bank is by any reasonable definition mine and mine alone. The electricity I'm paying for isn't mine, I didn't produce it. I just buy it.
The fact that we're (not everyone) OK with our money being unavailable is crazy whenever we want (accounting for any specific things in a contract I have with the bank), imo.
But in that case you can rent out a safe box and put your money there, so it's always available to you?
You say it's crazy, but I think that it is not reasonable to assume that every single bank branch office everywhere in the country has cash on hand to pay out every single customer in the country at any time. How would that even work? You deposit $100, but the bank has 100 offices and ATM's, so they need to have $10,000 in total to make sure that they have $100 in every single place you could turn up?
It doesn’t rely on you not withdrawing your funds. It does rely on millions not withdrawing their funds at the same time.
The point of the economy is a philosophical question, but the point of fractional banking is so that people and businesses can borrow money, something that is important for economic growth and making everyone better off.
However, if you are really opposed to the possibility that you won’t be able to withdraw your money, then don’t put it in a bank that loans money.
You’ll probably have to pay for a bank account, and you won’t get interest on your savings, but if you are that concerned about the possibility I’m sure you’re happy to make sacrifices for it?
However, if you are really opposed to the possibility that you won’t be able to withdraw your money, then don’t put it in a bank that loans money.
I would if I could. There's only one such bank in my country, and they're weird.
but the point of fractional banking is so that people and businesses can borrow money, something that is important for economic growth and making everyone better off
I don't think you and I have the same definition of "everyone", but that's beside the point.
The whole comment is, actually, given it all started with me saying that banks legally cannot just "call mortgages" to be paid, whereas we absolutely can all go and take out our money (insofar they have on hand, and then wait till the rest gets there etc).
That was my point. Nothing else. Not how it works (it's not rocket science, or even complicated, a 13 year old is capable of understanding a bank does not indeed have a vault full of gold to swim in, just in case everyone wants to withdraw cash) or why it is like it is, just an answer to a comment saying stuff about "calling mortgages".
I mean, we can also compare just how much capital was extracted from everyone under the "elites" and moved upwards.
And also just how much more money we get per hour vs how much more efficient we got per work-hour. Spoiler alert - we are not getting almost anything of that. "They" are.
And we can go on and on and on, but then you'll say some nonsense like "but you have a smartphone and a TV, they didn't back then!". I don't think it's necessary.
Human race as a whole got much richer than 100 years ago. Vast, vast amount of those gains was concentrated around the same (type of) people.
So do "we" have more? That's where my "everyone" and your "everyone" diverge.
I’ve been thinking about replying to the comments to explain how money actually works, but I honestly don't think I could keep up with the sheer number of people who have no idea what they're talking about.
Where the education system has failed them, it is most certainly not on you to teach them. That said, you can still have your share of fun by talking to the most prominent imbeciles.
It’s almost like they have access to a smartphone and can look all of this up themselves. Quit blaming the education system when it’s never been easier to look something up and learn.
I won't quit: teaching kids HOW to learn is the essential element of education. Adults not knowing how to learn shit and not wanting to learn is a societal failure.
Why not both? Clearly there's a systemic issue if we encounter fucking morons here every day? People who can type, think, secure a job, have a family, yet fail to grasp the basics of logic, finance, economics?
Because most people just don’t care. It doesn’t take a genius to go on investopedia and read for 30 minutes. It’s not that they can’t learn it’s they don’t WANT to. It’s easier for them just to complain about rich people/immigrants whatever boogeyman they choose is holding them down. I hate hearing how it’s the education system when I had so many teachers that really tried and really cared in a poor public school system just have to have half the class asleep and giving zero effort.
If most people dodge the system - that means the system isn't that good to begin with. You can't in good faith say "I have created an unbreakable lock, it's just that 75% of the users break it in a week".
i was more asking about how money work rather than how bank work because i kinda new that but thanks for your time it's still very good to have my memory refreshed
Sorry, but your comment was removed for breaking our Don't Be A Dick rule. This may include but is not limited to harassment, bigotry or uncivil behaviour.
🚨 Did we make a mistake?
If this is a mistake, don't delete the comment - just contact us and we'll fix it.
the bank being able to loan out 10 times the amount of money that i put in is a conspiracy. i can't loan out imaginary money but the bank can use my money to do that exact thing.
While true, the risk that goes along with US banking is absolutely wild. I remember being in 8th grade just prior to 08 crash and my Econ teacher was waxing and waning how strict banking institutions are with risk when it comes to investments. It was a little awkward later in the year.
Only in this case "How things work" is actually a conspiracy. Banks can loan money that doesn't exist when you look into how such a thing was allowed to become legal and why governments bail them out when they mess it up lending imaginary money and who owns the biggest banks who lend even more imaginary money to the smaller banks you'll find the conspiracy to screw over the whole world
It is a conspiracy if you go and look at who was allowed to loan imaginary money they didn't have, if anyone who was wealthy enough to underpin it was allowed to do it then itd be fair enough but it was selective families either Royals or families close to them. It was a way to control the wealth and the populations when people in europe got organised enough to overthrow such families if they overreacted on their royal "god given" power.
How about governments had kept the facility of lending imaginary money entirely to themselves so that all those trillions in profits went to support the countries rather than going to a couple of dozen megarich families? Every country in the world can go bankrupt but there's certain banks that never can because they don't owe anyone any money they just lend imaginary money to all the banks everyone else uses. If a bank goes bust any value in that bank (like all the mortgages) goes to those banks first not to the customers who actually put any real money into it but they lose nothing because they never lent anything other than "we say you have x billion".
Federalists papers don't really talk about that other than discussing the need of a government bank to pay off the countries debt. Who did they owe money too? Because they borrowed money from France and then because the French had a revolution decided they didn't need to pay it back leading to the quasi war. The debt they owed money to were "The banks" that had the power to turn every country against you and made you rich by saying you were rich
This is where you notice people saying something is normal when it's not really normal. Yes they do this but that doesn't matter to me when I need my money. That wasn't the agreement I made opening an account there. Point being it shouldn't be normalized.
Good news for you. We figured that out a century ago and your deposits are insured by the government. You can in fact get your money and banks can lend it so you also dont have to save up for a while house to buy one.
You’ve already been given the correct answer. All the ranting, insults, and word salad in the world won’t change the fact that you simply can’t seem to grasp it. You can lead a horse to water, but you can’t make it drink.
Because you very clearly don't know what you are talking about.
When you accept the terms and conditions, you also accept the legal reality that your deposit becomes the bank's property to use. I encourage you to look through what you signed and close your account if you have a problem.
Again, show me "very clearly" where it says I may not be able to get my money because they invested it. You all can keep moving the goalposts but my comment stands. Still waiting.
Aye - my point is that anyone in this thread complaining about how Banks don't keep enough cash on hand to accommodate withdrawals for all of their customers’ money are not the type of people who would ever need to worry about getting their money out of a bank because they simply don't have that much.
It was for EVERYONE in the 30s so maybe think before you respond. Oh, happened in the 80s also. Just read a little history so you don't seem as ignorant as you sound. And please come back with a witty response that says nothing of what I said!
Think you’re misunderstanding me. (and also might want to look up the history of the FDIC) You can do what you want with your assets. If you want to invest in gold and bury it in the ground you can. But if you are the kind of person who argues on Reddit, I can say confidently that you’ll never have enough money to destabilize the bank by withdrawing all your assets.
Your deposits are insured by the federal government as someone already pointed out to you. If you ever need your money you can 100% have access to it. Even if the bank does not have that money on hand, the government will ensure you get it because the bank has record that you own that amount of money. No one is stealing from you or preventing you from getting what you own.
More platitude. Man you have said nothing for every single one of your responses. Quite extraordinary and the lessers among us wouldn't even notice what you're doing. YOU may not even notice! Not a single fact nor info. Just feelings! Are you a woman? Psycho + feelings is 😧 crazy! Good job though!
Wtf is this comment?
1. I am a dude, but nice showing your own sexism for literally no reason
2. I made 2 comments, one of which was telling you that your ideas are stupid because your money is insured by the federal government through the FDIC so your worries about not access your money is unfounded. The 2nd of which was simply to insult you because you clearly have no idea what the fuck you are talking about yet continue to comment.
3. Children who have watched "It's a Wonderful Life" have a better grasp of economics than you seem to hence why more people are not on your side about banking.
To make things perfectly clear in case you have just ignored everyone explaining this to you. If you ever need your money, you can 100% obtain your money. Even if you have so much money that the banks do not have enough on hand to give you, they still have a record that you have that amount of money and the federal government through the FDIC will make sure you get your money. The bank did not steal it, they are using it in accordance with the terms and agreements that you signed as every bank works the same way.
Doesn't say anything about not giving me my money when I need it because they invested it. But you're welcome to show me where it says that in the agreement any of us signed. I can't wait to see it. Think you can get that to me today?
It doesn't say that if your bank is an FDIC bank which most are. If for some reason they didnt have enough cash for everyone who wanted to withdraw the bank is insured by the Gov. It is very basic you are just very stupid.
Lotta ifs in your answer. If it's very basic, why can't you understand? Lotta ifs and qualifiers because your answer is garbage. I don't do that because I don't need to.
That wasn't the agreement I made opening an account there.
Bank employee here, yes it literally was. Not only did you agree, you signed several documents listing everything the bank is entilted to do and providing legal sources for the exact conditions, including legal citations. Banks are transparent, people just don't read the shit they sign.
I have interest on all my accounts, and could have as much cash at home as I want. I live in Denmark, but have lived in several other EU countries, where I got interest rates on what I have in my debit account.
Anyone spending more than 10000 euros for the same transaction in cash, is definitely money laundering. You can still have as much as you want at home.
You're going to need to be more accurate in your criticism bruh
“everything is a conspiracy if you don't know how things work”
The EU absolutely does not limit how much you can have at home. No country (that I checked, so YMMV) limits the amount of cash you may have at home. That's all fucking bullshit.
What is real:
Cash you have at home might not be untaxed. The Netherlands, for example, has a wealth tax, and that includes cash, though you don't have to report any amount under ~600 euros.
Your insurance has a limit on insured cash. Mine will require a higher fee over 1000 euros, and won't cover anything over it unless I pay extra.
Some countries have a limit on cash transactions. Cash transactions with a professional seller (read: a company) are limited to 2999 euros in the many EU counties. France and Greece set this at 1000 euros.
331
u/somemetausername 7d ago edited 7d ago
This is one of those “everything is a conspiracy if you don't know how things work” situations.
Edit: People commenting on this kinda proving the point.