
Banking Is The Dark Matter of Economics (Part 2) - Bob Murphy & Steve Keen, DemystifySci #388
Economists Bob Murphy & Steve Keen come from very different camps. Today they sit together and pull back the curtain on how money really comes into being, piece by piece. Their exchange moves with a quiet intensity, uncovering the places where theory drifts from the world we live in. They trace the fault lines between stability and collapse, each from his own hard-won perspective. By the end, the familiar landscape of banking feels slightly altered, as if something hidden has stepped into view.
Part 1: https://youtu.be/fKgiKFfnPqE
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00:00 Go!
00:02:01 – How Banks Really Create Money
00:03:39 – Support & Merch Break
00:07:34 – What Is Fractional Reserve Banking?
00:10:06 – The 100% Reserve Ideal
00:12:27 – Why the Textbook Model Fails
00:15:00 – Base Money vs Bank-Created Money
00:18:46 – The Textbook Story Falls Apart
00:21:07 – Loans Create Deposits: The Core Mechanism
00:22:44 – Why Economists Get This Wrong
00:25:56 – Public Confidence as the Real Constraint
00:29:07 – Reserves Are Lubricant, Not Fuel
00:35:09 – Policy & Logic Undermine the Multiplier
00:36:46 – Who’s Actually to Blame for Crises?
00:39:18 – The Real Issue: Loan Quality & Targets
00:41:00 – Diverging Philosophies on Ideal Systems
00:44:12 – Modeling Real-World Lending Mechanics
00:48:53 – The Austrian Full-Reserve Vision
00:53:03 – Commodity-Backed Private Currency
00:54:37 – Ending Centralized Monetary Control
00:56:58 – A Regulated Credit Framework
01:01:12 – Elastic vs Fixed Money Supply
01:02:22 – Political Obstacles to Reform
01:03:16 – Market Discipline vs Regulation
01:05:08 – Limited Liability as a Core Distortion
01:08:23 – Asset Purchases, Bailouts, and Moral Hazard
01:11:26 – Policy Mistakes from Bad Models
01:13:16 – Productive Credit vs Asset Inflation
01:15:05 – Is Elastic Credit Even Necessary?
01:17:35 – Fixed Money Supply Lending Mechanics
01:19:15 – Closing Reflections
#economics, #banking , #moneycreation , #macroeconomics , #financepodcast , #credit , #monetarypolicy , #austrianeconomics , #complexity , #capitalism , #inflation , #recession , #centralbanking , #goldstandard #physicspodcast, #philosophypodcast
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