In theory, you are correct. But who is it that sends the budget to Congress for a vote in the first place, and who has veto power over that budget? Who is actually in charge of the people spending the allocated money? That would be the President.

If the President still held a role like Lincoln of old (with only a couple of aids and only a couple of secretaries), we wouldn't have to worry about an imperial government. Sadly, that just isn't the case any longer.

When a customer contracts with a bank to open a checking account, the understanding is that their money will be there for them to pull out when they need it. If the bank is going to use the money, they will be using it to fund loans not risky investments in other financial instruments. People put their money into savings accounts because of the lower risk - and consequentially lower return - that goes with having very liquid assets. If the banks were going to play with people's money in risky assets, they should have made that very clear up front AND offered a compensatory interest rate to offset the risk. That's not what they were doing. They were trying to take advantage of the system to make money by deceiving their depositors (not investors) and taking advantage of their status with the government to hedge against those very risks. That's not business as usual - except for the bankers maybe.

I bet almost no citizens actually know what the president can DO, and that includes me. That is interesting since the special interests gave 500 million to help elect Hillary. What is is tht they could actually get?

RELISH

You do not understand what legal tender is. You also do not understand credit.
"... creating legal tender from nothing..."

To expand on a popular myth, when John Galt wanted to build an electrical generator to light up Chicago and serve its energy needs, Midas Mulligan lent him 1000 ounces of gold to get started. Muilligan became an investor, expecting a return of 1 million ounces over a course of 20 years because of the fantastic potential of this new device.

Galt Power and Light went public and sold a million shares at $10 each, hired 1000 people and paid them on time every week for two years during start-up, and looked forward to a great future.

Sad to say, ironically enough, Galt was struck by lightning while boating on Lake Michigan with Ragnar. Totally dependent on his genius, the company folded overnight -- much the same way that everyone ran away from Arthur Andersen at the first whiff of trouble at Enron. Business is risky. In the famous words of Caldecott Chubb: "If there were no losses, there would be no premiums."

Was the money paid to the employees, suppliers, and others just "legal tender created out of thin air"?

See my comment to jeffdhurley.
https://www.galtsgulchonline.com/post...

How is money a different product than a piston ring - without which we would have no powerful engines - or a different service than software development?

I am in the Information World and I think that hardware production and software production should be separated. Should it be law?
jeffdhurley wrote: "I am in the Credit Union world and think that a separation of commercial and investment banking is a good thing . Two very different products ."

Are we all not sick and tired of computer failures? Why not assess all information companies a percentage of their profits and establish a fund to repay users for lost time and other values when computers fail?

Jeff, why is banking a special kind of business? How is money a different kind of product or service? My thesis is that it is not.

But there is a nominally free market in banking. I once heard Alan Greenspan say that the FRB knew of 15 kinds of money by definition, but only tracked five or six. The FRB exists only to spend government money for government things. From there, it washes across economic sectors. But it is not a physical monopoly.

Without revealing too much, exactly how many different kinds of money do you have right now? Three? Five? Think about it...

Do you think that the government should prevent the manufacturers of axle bearings from using their inventories as collateral?

I just mean that banking is a business like any other. If, as happens, you place a large order for future delivery of axle bearings with a manufacturer, and they go bankrupt and default on your order, is it because the government allowed them to co-mingle their inventories?

Most people do not understand money, just as most people do not understand science, or pretty much everything, really... They want the government to insure their bank accounts, their hospital stays, their vacation plans, their lifelong educations, and their favorite spectator sports. Banking is just another business.

The President has little actual power. Congress (the House of Representatives)- properly - controls the budget. The President might appoint laissez faire economists like Bryan Caplan and Don Boudreaux to the FRB, but they would have to be approved by the Senate. You can see the problem there.

I have them too but I sure can smell anything bad!, they only block out the good smells...go figure.

Blocked sinus saved me !! :-)

Excellent, blarman! IMHO, that's part of exactly what happened during the Clinton administration in the late '90s and set us up for the big financial meltdown in 2008! The PC forcing of banks to make risky loans (more subprime) virtually required the death of Glass-Steagall to move the "bad paper" in more creative ways and dilute them into other investment vehicles. Then, like the Chief in "The Outlaw Josey Wales" speaking to the snake oil salesman, somebody asked of the investment bundle, "What's in it?". The financial institutions essentially answered the same way as the snake oil salesman: "Why, I don't really know". And, like the Chief, potential buyers said, "Then you drink it." and the great financial freeze/melt down was underway. The only thing missing was a Josey Wales to spit chew on the white suit of the salesman, who in the real world is a composite representation of PC politicians and crony bankers.

Hope you were holding your nose...

That blew me away !!!!!!!!!!!!!!!!

YES !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

" I am in the Credit Union world and think that a separation of commercial and investment banking is a good thing . Two very different products ."

Definitely !!!!!!!!

Keep in my I said if the gov't is going to guarantee financial instruments, it should not bail out similar instruments that it never claimed to insure. This is not saying the gov't should insure anything.

You have a powerful related point suggesting gov't shouldn't guarantee any accounts. I think of FDIC insurance as different from other insurance because the FDIC is insuring a medium of exchange. It's not insuring value but rather something people trade for value. I can't see why that fact makes the insurance needs different. I would not be surprised to see the monetary/banking system go the way of the state-run telephone monopolies.

I think it would happen only after a huge crash tht destroyed the economy first, and it could be part of a rejuvenation

Any reform would have to be gradual, and would unavoidably would be somewhat disruptive. The damage could be minimized by simultaneously freeing the economy from its regulatory shackles and creating higher overall growth. A Libertarian president would be more likely to implement such policies than a Republican or Democrat.

I wonder what that would do to the economy, and how it could actually be implemented. The whole economy is built on excessive credit currently.

Getting rid of the Federal Reserve would be a good start.

I prefer UTM accounts myself...[under the mattress]...and it you think your going to enter my house knowing where my stash is...beware! I store all my nightime farts there also...

Unfortunately, corruption doesn't stop at the http://Beltway.It's all over the place from government to banking to retailing. If we manage to get Trump and if he manages to make inroads to Washington corruption it could be the start of a spreading cure to the infection. I realize that this is a Pollyanna view, but what else do we have? After all, it seems as if we are experiencing the rise and fall of the USA.

Uh, the whole reason the economy crashed was because banks were allowed to mingle their investment entities with their savings entities with the repeal of Glass-Steagall in the first place. Savings accounts were used as collateral in risky investments without the knowledge of their owners.

I'm all in favor of banks and financial institutions being forced to separate their investment sides from their consumer sides for the sole reason that most consumers don't want their moneys tied up in the risks of financial speculation. When they want that they invest in stocks, bonds, mutual funds, etc. I think you're over-reaching here...