Jeusu Recomended Good Banking

This is from the free side of Gary Norths blog. Its just great to see Biblical principles applied to what governments do. They are not above Gods standard. That the church has been silent, because it had no clue of how to speak to these issues, is testament to our spiritual poverty. The modern Evangelical Christian has lost the hsitorical foundation of our faith. There is no time like the present to rebuild the walls.

Monetary Reform: What, Who, When?Gary North

There is nothing wrong, morally ore economically, with banking. In a free market social order, bankers take deposits from investors and then seek out entrepreneurs to finance. They ask the entrepreneurs to pay more interest than the banks pay depositors. The bank makes its money from offering banking services. There are no free lunches and no free services in a banking system that does not use fractional reserves.

When a bank promises to allow depositors to withdraw their money on demand, the bank cannot lend money without resorting to fraud. If the money is loaned out, it cannot be withdrawn on demand. Any time a bank offers such a promise to depositors, it has moved into fractional reserve banking. It issues money to borrowers, but the money supposedly is also available to depositors.

The effect of this practice is to increase the money supply. This is monetary inflation. This process is described best in Murray Rothbard's textbook in money and banking, The Mystery of Banking.

So, there is good banking (morally and economically) and bad banking (morally and economically). Jesus recommended the first. He described God at the final judgment as saying to the unfruitful servant: "Thou oughtest therefore to have put my money to the exchangers, and then at my coming I should have received mine own with usury" (Matthew 25:27). The word translated as "usury" comes from the root Greek word usually translated as "bring forth." It means "increase." There is nothing wrong with an increase honestly attained. What is wrong is fraud....Whole article