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>The Second Greatest Story Ever Told  - Antal E. Fekete - Gold University
Well thought out argument, but it is based upon some erroneous assumptions.

"The unsurpassable naivety of this fable raises the question how serious students of money and credit have found it possible to treat it with respect. We should credit our ancestors with more intelligence and acuity than assuming that they fell so easy a victim to such a crude swindle, or that they meekly continue to be victimized long after the fraud has been exposed. "
The people of today readily accept fiat money, income tax, fractional reserve banking, credit cards, derivatives as investment vehicles, national inextinguishable debt and economic gurus. Either our ancestors had less intelligence and reasoning acuity or each succeeding generation leading up to us has suffered great loss of brain case capacity and/or brain function. We can assume that literacy rates are far higher now than 200, 500, or 2000 years ago. That puts your term of naivety in a far different light, no?

Here is the most probable reality.
#1 Fractional banking by goldsmiths actually was common. The fractional increase was probably less than 10%.
#2 Bills of exchange presume every buyer is a seller in a given marketplace. In fact merchants carried gold and hired guards as the caravans weren't just teamsters but traveling merchants as well. You would have each merchant transporting their goods to market in distant lands and transporting the traded for goods back to their home with no buying or selling along the way. Uh-huh, yah.
Consider the ship's captain of old. Not only was he tasked with transporting the ship's owner's goods, but also acted as the owner's selling and purchasing agent. Ever hear of the term "ship's purser"? And of course, these ships never carried real money; only letters of credit presumably?

Serious students should realize that the instructor tends to be intensely biased towards their own thesis. Things are far more complicated than any of us can imagine. Most myths and legends are based upon some historical occurrence. The day to day mundane never became a literary classic usable as a study in history of the marketplace.

"Second Greatest Story" tends to infer that you are a legend in your own mind. Perhaps that sells subscriptions. You have a lot of good arguments that make me sit down and think. Reality just ain't so simple or "cut and dried" as you would have us think. Were it so, it would be so self-evident that you would be redundant.

Still I rate it a 3.

3215 days ago
Beginning of the headline :Fable has it that paper currency came into being as warehouse receipts issued by the goldsmith against gold left on deposit for safe-keeping. The owners found that they could make purchases with these warehouse receipts as easily as with gold coins. Then the goldsmith went on lending out at interest his fictitious warehouse receipts. According to this fable, the fraudulent business of the goldsmith in issuing warehouse receipts against non-existent gold was the embryonic form of the fractional-reserve banking of today... Read More
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