Re: William Hummel's Website

[William F Hummel <wfhummel@xxxxxxxxx>]

John Gelles wrote:

>    In my last message I said I had on my site a text by
>    William Hummel.  I did for many years, but it may
>    not be there now.
>
>    His tremendous site is at   http://wfhummel.cnchost.com/
>
>    It's been a while since I read bill's prose. But I remember
>    it as the best there is on these subjects.

Thanks for the flattering remarks.
>
>    Some time back he was in favor of 100% reserves for
>    licensed banks. They would be downgraded to the status
>    of commercial lenders like General Electric.  Of course
>    that would mean they could not. like GE can, get all the
>    money they want from licensed banks. I never agreed
>    with this. It would give the central bank far too much
>    power over the money supply.

What I have proposed is a closer look at a system in which banks
no longer are empowered to create deposits ex nihilo.  In fact
private banks would no longer exist.  That is a little different
from a 100% reserve system.  Details of the proposed system can
be seen at http://wfhummel.cnchost.com/altmoney.html  I don't
claim that it is superior to what our current system would be if
the monetary authority were to exercise better control of lending
practices and require greater transparency.

In our present system, GE cannot get all the money it wants from
licensed banks.  Most of what money it gets is through the sale
of its own debt securities (direct borrowing), which simply
transfers ownership of bank deposits from investors to GE.
Ultimately investors will decide how much money GE gets.
>
>    Of course, Bill may have a different solution for inflation
>    today.  I will try to read his views now that Ihave re-seen
>    his site.  It is certain very attractive.

Controlling inflation is not what the proposed system is all
about.  It's main objective is to create a more responsible and
robust financial system, one that is less susceptible to systemic
failure.

William F Hummel