Up until now, the United States has operated under a "fractional reserve" banking system. Banks have always been required to keep a small fraction of the money deposited with them for a reserve, but were allowed to loan out the rest.
But now it turns out that Federal Reserve Chairman Ben Bernanke wants to completely eliminate minimum reserve requirements, which he says "impose costs and distortions on the banking system". At least that is what a footnote to his testimony before the U.S. House of Representatives Committee on Financial Services on February 10th says. So is Bernanke actually proposing that banks should be allowed to have no reserves at all?
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earlier:
WASHINGTON — Prisons in eight states let convicts work in jobs that give them access to Social Security numbers and other personal information for the public, despite years of warnings that the practice should end, a federal audit finds.
Most of the prisoners hold jobs processing public records for federal, state and local governments, according to the audit released this month by the Social Security Administration's Office of Inspector General. The work often involves entering and processing data on documents such as student transcripts, tax files, and health care and labor claims forms.
"Although we recognize there may be benefits in allowing prisoners to work while incarcerated, we question whether prisoners have a need to know other individuals' Social Security numbers," the audit says. "Allowing prisoners access to Social Security numbers increases the risk that individuals may improperly obtain and misuse (the data)."
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