I wrote this post originally as a comment to my man @john-robert 's question from this post: https://steemit.com/banking/@john-robert/q-what-is-a-public-bank. The comment got long and detailed and turned into a post.
(I wrote this like an assignment because I wanted to keep the language clinical before laying the splashdown at the end 😊)
There are two ways of answering this question. The first way is the way of truth and the second way is the way of ‘talk’. Truth is blindingly pure, and it is so sharp that it might cut us without us even ever noticing until we are bleeding. So, I will only ‘talk’ and leave the truth for the last paragraph.
The term ‘Public banks’ contains two words, ‘Public’ and ‘Bank’:
In the global financial structure, a bank can be thought of as a ‘node’ where ‘money’ can safely exchange hands. This ‘exchange’ can mean temporary storage, lending-borrowing, foreign currency reserves, bullion reserves, physically limited storage for some precious assets and of course backbone for insurance services (also, minting and printing fiat in some cases).
Now these services have been historically provided both privately and by the State. Thus, when we talk about a public bank we know that it’s origin or backing lies with the State. Public banks can be directly or indirectly owned by the state. Direct ownership means that a representative authority of citizens (like a government) runs and operates the bank. While an indirect ownership could mean a partial ownership by the government, where it holds the majority stake.
A public bank differs from a private bank in several manners. The first one being that a public bank works to provide financial service to the people of the State directly and/or indirectly (depending on its charter) while a private bank works to deliver maximum profits (within the boundary of the law of course) to its shareholders.
It is important to understand that in most cases public and private banks have no real difference in their definition except for their ownership. Also understand that public banks differ vastly from Central and Federal banks.
The idea of the public bank is that it provides its services in the favor of the people. The services would include the same kind as mentioned above – loans, currency exchange, digital money transaction services, etc. The banking services provided by a public bank are meant to serve the people, while retaining enough financial value within it that it keeps functioning. Even the profits generated by it are indirectly/directly returned to the people via the state.
Now the time for truth:
Banks whether public or private are financial criminals. They exist to control the flow of money by providing a false sense of security to the people who use it. They control your money while allowing you to think that you control it.
At this point of time in history they use fear to make you think that your money is only safe with them. They fund global events that make you think so. We all know what to call those who use terror to get their way…………
This is an example of a very thoughtful post about a very important question. I agree with your first point about "bank" as a "node" in a network of money-services.
I can see your point of view on the second point, and I agree that is a very realistic assessment of public banking institutions as they exist in the world today. I think about them a bit differently. Let's take your first point and apply it here. When I ask about public banks, I am referring to the mac-daddy of the network for money: central banks. These are the biggest nodes in the network. Although commercial banks do the actual money creation - it is the central bank which offers the greatest degree of risk to the system. Virtually no central banks are owned by the public. I think that cryptoassets like steem may enable certain people (within a network of trust) to establish a sort of public central bank to satisfy our money-services needs.
Although I mention that central and public banks have a different function but in the end they are part of the same convoluted system. Central banks take the evil to an even higher degree as their function is to actually participate directly in the economic policy of the government. Not only that but they also contribute to the formation of the same policy in a major way.
They are definitely the biggest nodes in the network - hands down.
Very interesting post. I will read this all in detail and maybe twice. Banking is no less than the most important institutions in our current world.
Thank you for your continued support of SteemSilverGold
Hi thank your post is good
Important to also note that the majority of the money the banks make is by using the money the customer deposit on account and lending it to others for a margin. In return, they provide an interest or services for the funds deposited which are much less than the benefits they get. However, they also leverage these assets (yes, your assets) to get loans to provide more loans and investments. What it all means is that if all bank customer were to TRY to withdrawal their funds simultaneously, the bank would not be able to give it all back because of their structure. So they depend on the government to insure their deposits in case of these scenarios. Unfortunately, we all know that the government themselves cannot sustain this either... so it is a vicious cycle!
It has always been the act of deception hidden in legalities. They use the money given to them for safekeeping in order to leverage themselves. In the end the money of the people is used to make more money off of them - vicious cycle indeed!
A very good explanation and a better conclusion.
Glad that you liked the ending :-)