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White contra Mises on Fiduciary Media

1 min read

White contra Mises on Fiduciary Media

Several recent blog posts indicate that the modern supporters of “free banking” continue to misconstrue the fundamental theoretical challenge posed by their critics. The main question is not about the ethical-legal issue of whether or not fractional-reserve banking is “fraud” under all circumstances. Nor, ultimately, is it even about fractional-reserve banking versus 100-percent reserve banking. It is about whether the creation of fiduciary media,[1] fraudulent or not, produces the sequence of phenomena we recognize as the business cycle.

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