It seems like a new banking system backed by something tangible again like how it was in the 1800's and prior would be a good move but would those of us in debt still be in debt to the banks? If not, how would our debts magically be absolved?
Example, say you owe money on your car and you have a ton of outstanding debt to a bank or credit lender. How exactly does implementing a new system of banking nullify this? Can't the bank still say "Since the USD is defunct, now you owe us the "New US Treasury Certificate" equivalent of that amount"?
I just can't quite put 2 and 2 together how the new currency would be debt free without older debts being absolved first.
The money we borrow doesn't exist until we borrow it.
Who exactly do we owe it too.
I mean.. You can see on your billing statement who you owe it to.
You owe it to the entity you took out the loan from.
So if a new banking system and current was implemented, I don't see how that would suddenly make the bank say "Oh ok. You don't owe us anymore. We're happy to have given you free money earlier. Thanks"
Wash it away maybe? Fractional reserve lending means only 10% of money exists in deposits. The other 90% is made up
Makes sense, but then that leaves the question of ownership. Say in this example you owed $5K on your car.. If the debt is "washed away" does the bank have the right to repo the car if you don't give them the $5K equivalent of whatever the new currency is?
Yeah that's where I get lost in this too