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Summarising the Role of the Central Bank
It should be clear from the above analysis that the collective institutions of government and the central bank play a huge and largely autonomous role in the shaping of monetary transactions. The main features of this role are:

Government is the central actor, without whom the banks could not exist in their current form. The Central Bank is simply the governments pet through which they control their monopoly over the fiat money system.

1. Provision of the legal framework that supports commercial banks in enforcing repayment of loans, thus ensuring that the CBDM arising from loan contracts is valued.

This so called provision of a legal framework is nothing but a lie, hidden behind smoke and mirrors. Enforcement of the repaying of loans at the point of a gun is certainly an accurate description.

How can a demand deposit, a legal contract of ownership between an individual A and a bank B which then lends the deposit owned by A to C who now also has ownership rights, be called legal? The deposit cannot be owned by two owners, yet that is exactly the situation that exists, enforced by government, and in extremis, funded through the creation of new fiat money by the Central Bank, which is just some more legality thrown in for good measure I guess.

2. Provision of central bank money by which transactions between banks and between individuals or banks and the state can be settled in monetary terms. This potentially enhances efficiency and competition in the commercial banking sector.

That is a function of money and a banking system. The money that keeps the banking system honest is a commodity money, gold or silver [or any commodity] that prevents the government from creating a monopoly over the supply of money, thereby facilitating enormous and ongoing theft. With no monopoly over the production of money, I can produce my own money: I find a gold seam and dig it out of the ground. Anybody can enter the production of money. Of course the finding and digging part rather reduces to new supply at any given point in time, and conforms to the laws of supply and demand rather than some nebulous government interpretation of a legal framework.

3. The autonomous ability of the government to make purchases of goods and services for collective use, by the issue of central bank money.

They can print up some money, or simply credit an account electronically, and exchange this fiat money for your goods and services that you produce through purposeful work, expenditure of time and means. That sounds like a really equitable exchange.

The commercial banks match this with their own issued money (CBDM) through adjustment of their balance sheets. There are various reasons why the government chooses to acquire the goods and services it requires in this way rather than simply by confiscation (which it has the physical power to do). Firstly there is the issue of equity.

Well revolution is probably a pretty good one. When you set out to steal from individuals why do it blatantly and really piss them off when you can do exactly the same thing without the majority even realise that you are doing so? Option [ii] is definitely the smarter way to go.

The resources government requires to fulfil its delegated functions may not be held equally by all. By issuing its money in exchange for goods and services, and then selectively confiscating this money in the form of taxation, the government can redistribute the burden of providing its resources.

All are not created equal. Some are destined to be successful entrepreneurs and earn more than the non-risk taking plodder, who is happy with a paycheck that more-or-less equals his abilities. Government however feels that the plodder should actually be subsidised by the more successful entrepreneur, who will contribute via tax a higher proportion of his earnings. Of course our successful entrepreneur is successful because he is smarter than our average plodder, and has ensured that he does not actually pay this government levy, escaping through the loopholes.

Secondly, for this system to be effective it of course essential that the money the central bank issues on behalf of the government is accepted. This is achieved by the requirement that almost all individuals and firms have some tax liability, and by the fact that central bank money and commercial bank money (itself demanded for loan repayment) are always interchangeable at a rate of one to one.

Commodity money provides exactly the same service and benefits save one: the government cannot create commodity money. To gain commodity money it can either [i] earn it on the free market [good luck with that] [ii] tax producers. The problem with option [ii] is that there are limits to how much a government can tax the producers, taxes are just so unpopular. Of course government spending is always out of control, a war here, a war there, subsidies to these chap’s, and those over there, and before you know it, they are straight into option [iii] debt. Again, the more government borrows, the more commodity money is removed from the free market, and interest rates rise as time preferences change, future money is always discounted against present money, and before you know it, boom, government are right back to option [ii] tax.

4. By ensuring a demand for its own money for the payment of taxes and the settlement of interbank transactions and by taking advantage of the demand of individuals for the portability and liquidity of cash by monopolising its production, the government may also hope to influence the quantity of CBDM issued.

Again all functions of money. A commodity money fulfills all these functions and requirements save one: it does not allow government to dictate or influence the quantity of money. The function most dear and close to governments corrupt heart.

This is generally performed by setting prices (interest rates) for the central bank’s purchase and re-purchase of high-grade financial assets (open-market operations), and for the last-resort lending of central bank reserve money.

Last-resort. Damn, sounds familiar. Must have been those pesky market chappies.

This latter ‘lender of last-resort’ function together with regulations governing acceptable asset risk composition for commercial banks also gives the central bank a role in ensuring that commercial banks remain solvent and capable of allowing individuals access to their deposits at all times.

Of course it does, as when individuals start exercising ownership rights on money that the bank has now created another nine legal owners for, the shit hits the fucking fan, and the banks become instantly bankrupt, pending a gargantuan bailout from the Central Bank who prints with reckless abandon, stealing on the SP even more purchasing power from our poor dupes.

Footnotes

(1) The Chartalists see the whole monetary system as imposed by the state and argue that the state uses its coercive powers to force the acceptance of tokens in exchange for the goods and services that it requires to carry out its functions (Wray 1996, Tymoigne and Wray 2006). In my view the state is responsible for the imposition of central bank money and ultimately responsible for enforcing the contracts involved in commercial bank loans, but the use of tokens of these loans in general exchange is a voluntary act arising from their superior liquidity to any other means of exchange.

And how is commodity money unable to fulfill these requirements?