Like Flynnwood above, I watched Mike Maloney's video, and another of his about the difference between money and currency. Interesting, but as he's a precious metals dealer, he wants you to invest in gold and silver, and he has a vested interest in telling you that the world's money systems are near collapse. Earlier in the thread, someone posted a link to another explaination of banking, made by a group of anti-capitalist protestors. That clearly has An Agenda as well. Consequently, whilst there is useful information in videos from both sources, they both (from opposite ends of the political spectrum) have too much baggage to be taken literally.
Does that mean I think everything in world finance is tickety-boo and hunky-dory? Well - no, but some background research shows that the history of world banking - for the last three hunderd years, anyway - could be written as a series of lurches from one crisis to the next, with brief interludes of relative calm between them. For example, in 1730 the London banking system all but collapsed, being saved by collective effort by London's merchants. The system survives because those most involved have a vested interest in it's survival - an imperfect banking system is better for world trade and thus for everybody than no banking system at all. Currently, we have too much debt floating about, at least in the Western world - the sum of personal debt is pretty much covered by the sum of personal assets, corporate debt is covered by corporate assets (illegal to trade if liabilities exceed assets), but the real problem is government - public - debt. Too many governments have spent beyond their countrys' ability to raise tax revenue for too long; debt to GDP ratios are too high. Things like QE and dodgy efforts to prop up the Euro don't help.
Having learned a bit more about how national and international banking works, I'm a bit more confident that things will be made to work out. Two main reasons - the one mentioned above that an imperfect system is better than a collapsed one for pretty well everybody, and the other which never seems to be mentioned; the people who stand to loose most if the banking system collapses are - the bankers. Think of Fred Goodwin - who would employ him, now? How much influence does he have over - well, anything? The other bankers, despite the opprobrium loaded on them by various protestors, have a very strong incentive to see that the world carries on at least reasonably smoothly. So they'll do whatever they have to to see that it does, as they have during every other banking crisis in history.
Rose-tinted glasses? Well, maybe; but history does seem to support the general idea. The banking system has always been made to survive some pretty severe crises, because it's in mankind's best interests - and the bankers' best interests - that it does. I think we'll survive this one too.
