The Banking Bubble and Panic of 1819 (HOM 22-B)

[@ProfessorBarth]

Follow me on Twitter: twitter.com/Professor_Barth If you enjoy this channel and want to support: www.patreon.com/professorbarth Buy my book: www.amazon.com/Currency-Empire-Seventeenth-Century-English-America-ebook/dp/B08L6ZPV19/ref=sr_1_1?keywords=currency+of+empire&sr=8-1 History of Money playlist: kzbin.info/aero/PLinliDgP9EbScxfH5wxoX8I_HNRSElqZ_ Foundations of Western Political Thought playlist: kzbin.info/aero/PLinliDgP9EbRu4qZn8SJFgysSQB5I4c-L

[@ttOORttUUGAA]

tell me why I've spent the last three hours learning about the history of money... No idea why. But I'm learning a lot & having a great time lol.

[@ProfessorBarth]

Glad you're enjoying it ; )

[@Chelsearuthc]

Do you remember where you found the stat, "The money supply increased by 60% between 1816 and 1818"?

[@renanfelipedossantos5913]

According to Hayek's Denationalization of Money, "artificially cheap credit" would not depend on the amount of hard currency backing banknotes, but the amount of actual goods and services being traded versus the whole supply of currency and credit.

[@ProfessorBarth]

Yes (such as in Spain after the influx of American silver and gold). The key word is "artificial". How does one distinguish between artificial and natural? I think when people speak about artificially cheap credit, they mean that credit is more readily available not because of increased production but because of something extraneous to that. I think a strong case can be made for that fitting the latter 1810s leading to the Panic of 1819.

[@edwardmclaughlin7935]

I thought the selling point of a central bank was that it provided assurance against boom/bust cycles - yet not long after the 2nd B.U.S gets going everything is busted?

[@Scr3amer42]

Stumbled upon this video randomly after going from bank run to bank run. This story sounds like 2024 to me :)) US Dollars and most other currencies in the world are worthless but most people don't realise it. We are getting scammed by private banks from oligarchy protected by politicians. Creating money ex nihilo to provide loans and charge interest on top of it is the most criminal thing ever. I have been thinking about that since 2008 and I think the only good solution is to have money supply proportional to population. Population doubles ? Central bank (only) can double the money supply. Population decreases by 25% ? Central bank has to destroy 25% of the money supply. Private banks need to take the money from A to lend it to B. This way we restrict the amount of loan they can make and keep prices stable and avoid asset bubbles. That's the only way to have 0% intrinsic inflation on the money. We would only have specific inflation due to people behaviour. Which is fine. But that would prevent the oligarchy to easily concentrate even more assets by giving us paper they created the same morning.

[@RemoBabii]

Man this is so good!!!

[@jeffarnold3800]

So the primary issue with the land price inflation vis a vis the banks was that the banks had extended loans to speculators who couldn't repay them, or that banks had invested directly into land themselves? Or both?

[@ProfessorBarth]

Primarily lending to speculators, though I am curious now if some of the banks themselves invested directly into land. But definitely the overwhelming majority of land price inflation came from loans to speculators.

[@nickpll]

What was it that caused credit to be so cheap during this period? Was it the second bank of the United States?

[@Seth9809]

Possibly all the state banks, if not the national bank.

[@MeanderingPathos]

Let's say you were magically transported to this time, maybe a handful of years prior, and you were in a position of power, enough to where you could influence the direction of the economy. What would be your recommendations? (Other than of course drill for oil to create new technologies and things which don't pertain directly to how to logistically get yourself out of a pickle like this without advanced tech knowledge)

[@scottthomas3672]

Hey Professor, It's all Fiat Currency. It's a big club, and you ain't in it. It's like printing 3 trillion then another, it's all shit

[@ProfessorBarth]

I get a chill down my spine every round we get those monopoly-money "stimulus" checks. Classic currency devaluation right before our very eyes. The working classes will get hit the hardest.

[@brecky]

Easy to say that when you didn’t need it to pay rent.

[@JAFFAWIRE]

@@brecky OK, have you wondered why your rent went up?

[@veritasmenscounselling]

​@@ProfessorBarth right again, Professor. A tale as old as time.

[@Seth9809]

@RazorRayMcCoy Same reason why oil prices go up when OPEC tells its members to pump less.

[@JAFFAWIRE]

This should be mandatory learning for every Modern Monetary Theory idiot out there nowadays.

[@Seth9809]

Except modern monetary theory was created because of this.