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Description:  “I’m going to start with a model of a perfectly safe 100 percent reserve economy,” said Robert Lucas, “…which looks better and better to me.” Lucas, a Nobel Prize-winning economist at the University of Chicago, was speaking two weeks ago at a panel in San Diego to mark the 100th anniversary of the Federal Reserve. It’s a fairly radical place to start.

Source:  Businessweek.com

Date: Jan 25, 2013

Link: http://www.businessweek.com/articles/2013-01-25/why-well-still-never-see-a-100-percent-reserve-economy#r=hp-ls

Questions for Discussions:

  • What is inside and outside money?
  • What is the relationship bewteen banks and the Federal Reserve in terms of the creation of money?
  • How would stricter rules for banks change their business models?
  • Do you think this would be good or bad for the economy as a whole?

 

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