Reasons Why the Banks are in Trouble | Gregg Braden

Gregg gives his personal option on why the banks are currently in trouble. Read a summary of the video below.

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Video Summary:
In the video, Gregg Braden provides an explanation of how the fractional reserve banking system works. He mentions that when a customer deposits money in a bank, the bank is only required to keep a fraction of that money on reserve (usually 10%) and can lend or invest the rest. This means that banks are deeply interconnected, and when one bank experiences financial problems, other banks that have invested in it can be affected as well.

Gregg also discusses how in March 2020, during the COVID-19 pandemic, banks decided to remove the requirement for them to keep any money on reserve. This meant that if all customers decided to withdraw their money at the same time, the bank would not have enough cash to meet those demands, causing the bank to become insolvent.

Regarding alternative investments, Braden discusses precious metals and cryptocurrency, particularly Bitcoin. He notes that while cryptocurrency is not backed by physical assets like gold, it has value because many banks and tech companies are investing in it, and it is limited to 21 million units. He also explains that Bitcoin is secure and transparent, and offers a peer-to-peer alternative to traditional banking that can be used to send money without high fees or taxes.

However, Gregg acknowledges that cryptocurrency is volatile and risky, and suggests that investors should diversify their investments to protect themselves from such risks. He also notes that there are other drawbacks to cryptocurrency, such as the potential for hacking or loss of funds if a user loses their private key.

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