The root of the problem is fractional reserve lending in conjunction with a Fed that micro-manages interest rates without having a clue as to what they are doing. So, if banks want to sell insurance, peanut butter sandwiches, and Girl Scout cookies while offering checking services I say go for it, provided we get to the real solution to this banking mess.
The solution to this mess is not more regulation but less regulation and less government interference. The best things to do would be to abolish the Fed and eliminate fractional reserve lending, the latter on a phased in approach.
Sunday, 9 March 2008
(Pea)nuts in your bank
Mish is one of my favourite bloggers.