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Before discussing fractional reserve banking, let’s go over the concept of full reserve banking. Suppose a bank takes in total deposits worth $100 million from its depositors. The bank promises the depositors that they may withdraw their deposits anytime. The bank, in this case, simply acts as a warehouse for the money deposited, collecting fees from the depositors in return. At any time, all deposited money remains within the bank; and at any time, any or all depositors may come to collect the money they have deposited. This is full reserve banking: all the deposits remain in reserve. ...

In no particular order, the following are some of my favorite anime shows. These are all completed series I have fully watched, sometimes multiple times. Avatar: The Last Airbender This is the series that really got me into watching anime. A fun story about the last airbender traveling through different lands and ultimately defeating the evil king in the fire nation. Simple, children’s cartoon with excellent characters and relatively predictable plotlines, but very well executed. ...

Any amount of money in an economy is ‘abundant’ provided it can be divided and combined according to the needs of the economic actors. That’s not the kind of abundance I’m referring to in the title. I’m instead referring to monetary inflation. More than the absolute stock of money, what’s relevant is the rate at which it is increasing. The Medium of Exchange Problem As discussed in Price and Money, a price is simply the exchange rate between two goods/services. Money is a good that acts as a medium of exchange, negating the need for double coincidence of wants. Due to the prevalence of money, Adam can sell his service to ‘buy’ money, and then ‘sell’ the money to buy goods he wants. This renders unnecessary for the sellers of those goods to desire Adam’s service before Adam may have his wants met. ...

Central bankers and economic textbooks will have you believe that economic inflation is “an increase in the general price levels.” Due to inflation, your money is worth less than before—its purchasing power lower than it used to be. Capitalism, fall in supply, rise in demand, etc. are blamed. Everything but the main culprit is discussed. This is an instance of exclusionary detailing. Learn to see through the smoke and mirrors. ...

Just found out about this neat tool called imagemagick. I’m using it to compress jpg images small webp images for use on this blog. Install it (in arch-based linux) using this command. sudo pacman -S imagemagick Then run magick image.jpg -resize 1600x -quality 75 image.webp to create a compressed version of the image. Here the max pixel width is set at 1600 px, and the quality is at 75 (moderate compression). ...

In Saifedean Ammous’ podcast with Thomas Massey, Hayek is accused of being a little too socialist and his book The Road to Serfdom overrated. He is praised, however, for being diplomatic enough with the mainstream to remain relevant until winning the Swedish Central Bank Prize (the so-called Nobel Prize), and then speaking the anarchist language. The Road to Serfdom is the only book by Friedrich Hayek that I have read, and based on just that, I have to disagree with the socialist-lite characterization. The ideas he promotes are libertarian. He does not go up against the Keynesians, but then, the book was meant to target socialists, which it did. ...

Did Qifrey just wipe Nolnoa’s memories? How much of them did he wipe? This cannot be good. Witch Hat Atelier was much anticipated, and I have been watching each episode as it’s getting released. Little pre-teen girl casts a spell that kills/traps her mother, gets adopted into an atelier, and begins her journey into the precarious world of witchcraft. The artwork and animation are great. The over the top expressions often are too annoying. The character-work is excellent. ...

Note that the law applies not just to a particular type of coins, but to the exchange rates between different money commodities as well. Suppose in a bimetallic standard, metal A is pegged to metal B at a ratio of 1:10, but the market value of a unit of metal A is 12x that of metal B. In this case, we have a price ceiling whereby metal A is artificially undervalued, and per Gresham’s Law, will be driven out of circulation. ...

Gresham’s Law is frequently oversimplified as “bad money drives good money out of circulation.” This phenomenon has been observed in history whenever debasement of coins has occurred. In such cases, people choose to collect coins with the greater precious metal content and spend the debased coins. Over time, the ‘good’ money, the coins with more precious metal in them, get driven out of circulation by ‘bad’ money, the debased coins. ...

A price is simply a ratio of something in terms of something else. It need not necessarily be in terms of a fiat currency. The price of a certain watch may be ten pairs of a certain brand of shoes, or equivalently, an hour of consulting service of a certain expert, and so on. The ratios in terms of some goods become more prevalent due to their characteristics: durability, recognizability, divisibility, scarcity; these goods begin to acquire monetary recognition as individuals start accumulating them for the express purpose of exchanging them (as opposed to consuming them). These goods are traded more frequently than other goods due to their utility as media of exchange. The most traded good, thus, emerges as money, and market participants find it convenient to denominate prices in terms of this money, which, historically, has been gold. ...