Why I think banks should become money warehouses and deny investor loans

Investors should not be given direct access to banks' money creation resources for several reasons.

Firstly, banks create money through the process of lending. When a bank makes a loan, it creates new money by crediting the borrower's account with the loan amount. This new money is created out of nothing and is backed by the borrower's promise to repay the loan. Allowing investors to have direct access to this money creation process could lead to an uncontrolled expansion of the money supply, which can have negative consequences such as inflation and economic instability.

Secondly, banks play a crucial role in the economy by allocating credit to productive investments. They assess the creditworthiness of borrowers and make lending decisions based on various factors such as the borrower's ability to repay the loan and the viability of the investment project. Giving investors direct access to money creation resources could bypass this important credit assessment process and potentially lead to a misallocation of resources and increased financial risk.

Furthermore, banks are subject to regulatory oversight and prudential requirements to ensure the stability and soundness of the financial system. These regulations include capital adequacy ratios, liquidity requirements, and risk management standards. Allowing investors to have unrestricted access to money creation resources could undermine these regulatory measures and increase the risk of financial instability.

Banks play a vital role in the economy by allocating credit to productive investments and ensuring the stability of the financial system through regulatory oversight.

Allowing investors to bypass the credit assessment process could potentially lead to misallocation of resources and increased financial risk. Investors should not have access to the public money creation.

Lending money to companies that produce goods or services, which in turn translate to a net asset value, is a prudent approach for banks to support economic growth and stability. By assessing the creditworthiness of borrowers and the viability of investment projects, banks can contribute to the overall health of the economy. It's essential to maintain the integrity of the money creation process to prevent uncontrolled expansion of the money supply and its negative consequences.

I feel banks should lend money to companies that produce a service or a product which translates to a net asset value.

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