MONETARY REFORM - A BETTER MONETARY SYSTEM FOR ICELAND
“Monetary Reform” because it goes beyond the technical details of bank regulation to question who should create money and how we ensure that new money is devoted to useful ends. It does a crucial job of public education, explaining how “fractional reserve” banks create money, and why excessive levels of private debt will inevitably result in crisis. And it explains why financial and economic instability cannot be effectively managed using only the interest rate policy tool on which central banks have traditionally relied. It proposes a radical structural solution to the problems we face. The feasibility and merits of that specific solution need to be debated. But whatever the precise policies pursued, they must be grounded in the philosophy which this report proposes – that money creation is too important to be left to bankers alone.