Why We'll Still Never See a 100% Reserve Economy

Blinder: Leave credit creation to the banks Photograph by Joshua Roberts/Bloomberg

“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.

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