Free Banking: An Alternate Solution to Full Reserve Banking

I’m writing this article as a response to a comment made on my post called Banking Reform: Full Reserve Banking. As a capitalist and libertarian, I try to find the best solutions to problems and at the same time, find the solution that will increase freedom to the greatest possible extent. I do not believe I have the best and only ideas out there and that is why I appreciate input from readers. Specifically, one reader proposed to me that free banking could be an alternative to mandated full reserve banking.

I have thought about the two systems for a while and have come to agree that it may be the freer of the two since there is no mandate for full reserve banking and in addition to that, may be more feasible to implement. In this article I will give the argument for free banking. I like both systems, but I would like to give libertarians and capitalists out there more ideas than just my own. As it stands, I may end up preferring free banking to full reserve banking.