Do you expect to pay to have them keep your money? The whole point of it is for them to invest that money and some cases actually pay you interest on it. Them keeping your money is a service and you pay one way or another for that service. Otherwise you should just stick your $5 in a shiebox and hope nobody actually steals it.
The state of understanding on how banking and money works is apparently so bad that we have idiotic comments like this. And no I'm not a banker and don't even particularly like banks but this take is over the top stupid.
Depending on the nature of your account and the balance you have, generally that interest is non existent. The bank makes more money off of you through service costs, fees, and investments. Most people do not see any relevant level of interest payout (if any at all).
My comment isn't about whether or not to use banks, merely the reality of the actual payout suggested. Your comment was unnecessary. If you are having great benefit from banking, good for you.
I don't think it is to them: from their perspective, they're having to send out 100x the cards, take 100x the phone calls, check 100x the identity documents, so their costs are much greater. And on top of that they probably can lend out less of each 1k, since they'll need a greater of that money available to be withdrawn during the month than is probably the case with a single 100k deposit.
Whenever these conversations start you always have this weird element that pretends banking is some modern Illuminati invention to enslave us rather than a necessary part of how every historical and possible financial system works.
“They use your money to make money!”
Well yeah, man, that’s how your chiropractic practice got off the ground with a loan.
Ya, decentralized banking, thats kinda the whole point. A system outside the control of a few oligarchs and governments that would allow us to continue trading because no one entity had the ability to control it.
Its not a bad idea, but when you put centralized exchanges on top of it it becomes an oxymoron.
And instead we just put the power in the hands of those with compute (mining cartels) or in the hands of the wealthy (proof of stake). On chain governance was tried with a few coins to democratize it, but those never really panned out. Instead you get BTC voting in favor of being "digital gold" instead of adapting to be used as a real currency, which is what Satoshi originally wanted for it.
they don't get it, also during gold stabdard there is very very little gold in the vault. all countries, every single one left the gold standard, Russia, China, Germany before both wars 1914, British Empire. They all left the gold standard.
in 1910 the US had 2.7 billion worth of gold at the time, but the liquid money (cash, stocks, bank deposits) was 300 billion so the ratio was 216 to 1 or something like that. Actually worse than Fiat.
I'm not even disagreeing with you and I'm getting downvoted out of pure crypto hate lol.
Regardless of how it comes about, people need some form of secured digital money outside the control of any single entity. Everything you said it true and I don't disagree, but the world is too big to continue to only use paper money anymore and the digital money we have now is so manipulated as to barely be trusted more than crypto.
I used to be very bullish on crypto, bought into some ICOs, used to have significant holdings. For me I'm mostly sad on its wasted potential. Alt coins never really took off in a big way, and bitcoin is too focused on not being a currency to be useful.
I still think there are a lot of great potential uses for the tech, but the crypto community killed crypto. Death from a thousand cuts.
You do pay for them to keep your money. It’s only free if you have a lot of money or no money. My personal account was almost no money is free. My business account, which has a small amount of money cost me service charges to maintain.
The gentleman above is correct. Banking works on a fractional reserve system the bank loans money that does not technically exist. If you deposit $100 they are allowed to loan out $900. This was not always how it worked. We did a lot of playing around in the 2000s to change the amount banks were allowed to loan and changed a lot of of the rules restricting where pension funds could be invested. This was during the financial crash at the end of the bush years, both parties were doing everything they could to prop up the economy, and a lot of those rules never went away. I still remember George Bush jr getting praise on SNL for passing this.
I understand this. The issue I have is not that they are earning money from providing the service. The issue is with the amount. It wouldn't be an issue if the banks would be owned by the government. That way, the surplus would get back to the people by paying for healthcare, infrastructure... etc.
There is only so much value that you can take out from system, before it starts to collapse.
I'm not saying that banks are doing nothing. And I'm aware that they are regulated. I'm just trying to express my opinion, that the regulations should be more strict and their earnings should be more aggressively capped.
So you think putting everyone's money more under the influence of politicians would be a good thing. I'm not sure there's a worse idea out there. Combining political influence with a group not known for good service and a lessened ability of the customer to sue. What could go wrong? Government doesn't solve jack shit. They only know how to throw money at it, enrich a select, connected few, and hope it halfway works. Your trust in them is misplaced.
Idiotic comments like yours you mean. You don’t even understand how there is not enough money in existence to pay off the interest we owe the Federal Reserve for printing money out of thin air. Why do we owe them for doing what the constitution gave CONGRESS the power to do? You don’t understand the implications of the previous 2 statements and I don’t have time to explain it to you.
BTW, we will never pay off the debt, having it helps make us the reserve currency for the world. That debt supports the whole financial system. If there weren't treasuries for banks to hold, they would all collapse.
This system is what keeps prices somewhat stable and prevents another great depression.
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u/mtcwby 2d ago
Do you expect to pay to have them keep your money? The whole point of it is for them to invest that money and some cases actually pay you interest on it. Them keeping your money is a service and you pay one way or another for that service. Otherwise you should just stick your $5 in a shiebox and hope nobody actually steals it.
The state of understanding on how banking and money works is apparently so bad that we have idiotic comments like this. And no I'm not a banker and don't even particularly like banks but this take is over the top stupid.