[metaphorm]

> Our system issues credit against land.

as far as I understand it, no, it doesn't. the currency issued against NOTHING except "the full faith and credit" of the Federal Reserve. the only thing backing the currency is the principle that loans made by the Federal Reserve will be paid back, with the stated interest, no matter what.

[bufordsharkley]

That's true for currency from the government itself. But for the stuff we actually use, that's issued from private banks, constrained by partial reserve banking.

It's true that to some extent, their assets are land (real estate is a common collateral). It's not shocking that land busts and banking crises tend to coincide.

[metaphorm]

the land (and house, usually) are used as collateral in home mortgage lending, which is a major category of lending but not nearly as foundational as Federal Reserve lending, which is the basis of the entire fractional reserve banking system.

there are many other categories of credit that rarely use land as collateral. small business loans don't (or almost never do, in any case). corporate bonds don't either. consumer credit (including student debt) is totally non-collateralized.

[branchless]

https://bankunderground.co.uk/2015/06/30/banks-are-not-inter...

Banks create mony when they lend. Fed doesn't constain this.

[rmah]

The "money" banks create when they lend is the same sort of "money" you create when you deposit cash into your checking account. The problem with money conspiracy theorists is that they conflate different types of money (M0, MB, M2, etc) into one pile they call "money".