Comments (26)

• N. Joseph Potts

  40% of US international trade in 1984 was barter? I wonder what he's talking about.

  Published: May 23, 2008 11:53 AM

• billwald

  Solution is simpler - another revolution to produce 50 sovereign nations under a revised Articles of Confederation. 50 sovereign state equals 50 economic experiments. May the best experiment win.

  It should be obvious that one set of laws for this country is silly. For example, a single set of rules for governing the Everglades and the Olympic National Park doesn't compute.

  Published: May 23, 2008 7:13 PM

• Mike Sproul

  Dr. Paul doesn't see the contradiction between libertarianism and the "hard money" views he advocates. People should be free to issue money without government interference. This means the government should not ban fractional reserve banking. It also means the Fed need not lose its right to issue money, it just shouldn't have monopoly on the issue of paper money. Dr. Paul is also wrong in equating the Fed with a counterfeiter. Counterfeiters do not stand ready to use their assets to buy back the dollars they have issued, but the Fed does.

  Published: May 24, 2008 4:30 PM

• Patrick W

  Mike Sproul: a) good observation about Paul + the Fed + counterfeiting.

  b) Regarding the Fed having a monopoly over the issue of paper money...does it even have one? Ie. the community currency movement uses paper money.
  

  Published: May 24, 2008 7:08 PM

• TLWP Sam

  Break up the U.S. Federal Government into 50 Federal Nations which were formerly U.S. States? Why? Are smaller governments more honest? It has also been tradition that there's one rule per country. You'd instead have 50 sets of rules for 50 new countries not 50 competing law&order firms competing in the one country. That does not compute.

  Published: May 24, 2008 10:30 PM

• Fred Furash

  Patrick, to answer your question (part b) look up the liberty dollar, how they were raided by some treasury agency, and all of their gold and silver backings were confiscated. So yes indeed they do have a monopoly, perhaps they just don't always enforce it, preferring to make example cases.

  Published: May 25, 2008 8:43 AM

• Mike Sproul

  Patrick W:

  The textbooks usually cite the National Banking Act (1861-63) for placing a 10% tax on notes issued by state-chartered banks, while requiring nationally chartered banks to post $110 in government bonds for every $100 in notes issued. I understand that the law has been overturned. There was even something on this blog about it a few months back, but I've lost the reference.
  Anyway, there are Disney dollars, Toys-R-Us dollars, gift certificates, etc., all of which can, and do, serve as paper money. Apparently, the only institutions that are unable to issue paper banknotes in this country are banks themselves.
  As to community currencies, they sound like a scam. The over-riding requirement that anyone should have for any community currency is that its issuer stands ready to buy it back, and I gather that's not the case for many of these community currencies. Disney dollars, etc, usually can't be redeemed for cash, but at least the issuer stands ready to give you a dollar's worth of goods for each Disney dollar.

  Published: May 25, 2008 10:39 AM

• Fred Furash

  Remember that gift certificates aren't a form of paper money, since in order to acquire them you have to spend some official dollars first. They're just a way for you to let the gift receiver choose what they want. They don't actually serve as money, because you cannot exchange any of your own goods and services for them. The only reason they are allowed is that they are not in actual competition with official currency, you could say they were a derivative of it.

  Also, state issuance of currency doesn't mean anything anyway, law or not, because a state is just a lower level of government, and the federal reserve has such entrenched interests within the realm of politics that no concerted effort to issue their own currency would ever happen anyway, even if it were legal. Not only should private banks have the right to issue any form of currency they should wish, but any individual should be able to. I should be able to create the Fred dollar if I should wish, and contract with banks so that they deal in my dollar. Just as the federal reserve banks and the treasury are separate, in the free market you could have a separate money issuer. In fact, this may prove to be a more efficient way of ensuring no fractional reserve banking occurs (for those currencies that do not wish it). If banks issue their own currency, they may be too compelled to expand it using stealth (current account expansion, as today). People may not notice it, at least for some time. A separate issuer contracting with the banks that ran regular checks may be a better way of securing against inflation.

  Published: May 25, 2008 2:12 PM

• Mike Sproul

  Fred:

  "Remember that gift certificates aren't a form of paper money, since in order to acquire them you have to spend some official dollars first."

  I could sell $20 of fruit to a grocer, and I'd accept his $20 gift certificate in exchange. I could then pay the $20 certificate to my gardener to mow my lawn, and the certificate might pass through several more hands before it is redeemed at the grocer. Gift certificates are, in fact, a form of paper money.
  

  Published: May 25, 2008 10:24 PM

• newson

  mike sproul says:
  "I could sell $20 of fruit to a grocer, and I'd accept his $20 gift certificate in exchange. I could then pay the $20 certificate to my gardener to mow my lawn, and the certificate might pass through several more hands before it is redeemed at the grocer."

  
  surely as fred says, legal tender means that greengrocer notes are not money. you cannot oblige someone to accept them in fulfillment of a debt. plus their are going to trade at a discount to face value, or perhaps be totally illiquid.

  Published: May 26, 2008 10:24 AM

• Silverleaf

  As a neophite in the understanding of historical monitary policy, and having only recently (this weekend) begun to undertake the challenge of enlightening myself about it, I was shocked to discover that any particular dollar bill that I might hold in my hand is backed by precisely...nothing tangible. I had always assumed (a danger that many people expose themselves to through willful (or perhaps blissful) ignorance) that my dollar was merely a more convenient transportation mechanism for some standardized amount of gold or silver. Enter my understanding of the concept of "fiat paper". Add that to my dawning understanding of fractional reserve banking, and one can clearly see that I'm having a rough weekend... It's nice to find a site like this that contains intelligent discourse as opposed to the bombastic drivel found elsewhere on the 'net.

  Published: May 26, 2008 11:25 AM

• Mike Sproul

  Newson:

  Many things have been used as money without being legal tender, and many things have been declared legal tender and failed to be used as money. The two things are not equivalent. The grocer notes may or may not trade at a discount, but they would still be usable as money in either case.

  Carrying this a step further: The grocer can increase the quantity of certificates he issues, and as long as the grocer's assets rise in step with his issue of certificates, those certificates will hold their value. The local bank can even accept these certificates on deposit, and issue certificates of his own on fractional reserve principles. Since this activity does not affect the assets or liabilities of the grocer, the value of the certificates would be unaffected.

  Published: May 26, 2008 11:36 AM

• Mike Sproul

  Silverleaf:

  "Enter my understanding of the concept of "fiat paper". Add that to my dawning understanding of fractional reserve banking, and one can clearly see that I'm having a rough weekend... "

  Allow me to make your weekend a little rougher by pointing you to the real bills doctrine, which says that your old belief that the dollar was backed is, in fact, correct--just not in the way you used to think.

  You used to think the dollar was physically convertible--that the Fed stood ready to buy back you dollars with a certain weight of silver or gold. That is not the case. The dollar is, however, financially convertible. The Fed does, in fact, stand ready to buy back your dollars with a dollar's worth of bonds. When financial convertibility is conducted in the right way, physical convertibility can become irrelevant.

  Published: May 26, 2008 11:45 AM

• Silverleaf

  Mike:

  Having already admitted my status as a neophyte in this arena, and possessing nearly limitless ignorance of it, please excuse the following question if it smacks of naivete, but in what acceptable sense can physical convertibility ever become irrelevant? It would seem to me that at some level, when all of the machinations of complexity are removed, "money" has to ultimately be based on something of actual enduring value. To my admittedly simplistic (and, perhaps, ignorant) way of thinking, bonds are nothing more than pieces of paper promising payment that ultimately have value only so long as the entity making the promise a) continues to exist or b) chooses to make good on its promise. Given that tangible substances such as gold have existed, and been valued, for far longer than any bond-issuing entity or its promises, it would seem that physical convertibility can never be deemed irrelevant...

  Published: May 26, 2008 1:06 PM

• Mike Sproul

  Silverleaf:
  "in what acceptable sense can physical convertibility ever become irrelevant? "

  Suppose that paper dollars are physically convertible into 1 ounce of silver. Then something happens to reduce peoples' desire for paper dollars--the Christmas shopping season ends, for example. People bring 50 'unwanted' paper dollars to the bank, intending to get silver. The bank, if it wanted, could head off this demand for silver by selling $50 worth of bonds in exchange for 50 of its own paper dollars, which it could then retire. In this way, the bank's maintenance of financial convertibility made physical convertibility irrelevant. Needless to say, there's quite a bit more to say on the subject, and you can find it by clicking on my name above and reading about the real bills doctrine.

  Published: May 26, 2008 3:24 PM

• fundamentalist

  Silverleaf: "...in what acceptable sense can physical convertibility ever become relevant."

  Actually, in Austrian econ physical convertibility is not relevant. The original purpose of converting paper money into gold or silver was because people didn't trust paper money. Convertibility encouraged their trust. Once paper money became acceptable, convertibility ceased to be an issue. As long a people have confidence in a thing as money, even paper, the only thing that determines its value is the ratio of the supply of that money to the supply of goods. Even in the days of direct convertibility to gold or silver, the value of paper money would fluctuate wildly with the increasing or decreasing supply of the paper money, regardless of the official conversion rate to gold/silver.

  Published: May 26, 2008 7:01 PM

• Fred Furash

  "Actually, in Austrian econ physical convertibility is not relevant. The original purpose of converting paper money into gold or silver was because people didn't trust paper money. Convertibility encouraged their trust. Once paper money became acceptable, convertibility ceased to be an issue."

  No, backing is still relevant in order to avoid credit expansion and currency devaluation as per fractional reserve banking.

  
  Also, Mike, when I meant gift certificates were not useable as money, I meant in their current form, whereby you cannot directly trade a good or service, but must first use dollars to obtain the gift certificates. If they ever approach real currency, they will be made illegal.

  Published: May 26, 2008 7:13 PM

• Fred Furash

  Mike, while I'm at it, I skimmed through a bit of your website, and I recommend you read Jesus Huerto de Soto's "Money, Bank Credit, and Economic Cycles."

  The same goes for Silverleaf. This book is absolutely fantastic in my opinion, and contains everything you need to know about money. It;s available for free on mises.org

  Published: May 26, 2008 7:49 PM

• fundamentalist

  Fred: "No, backing is still relevant in order to avoid credit expansion and currency devaluation as per fractional reserve banking."

  Gold/silver backing never stopped credit expansion. Some of the worst periods of credit expansion/collapse causing financial crises occurred long before paper money when gold/silver were the only money. Money substitutes can be nothing but accounting entries.

  Published: May 26, 2008 8:49 PM

• Mike Sproul

  Fred Furash:
  Yes; backing is definitely relevant. If bank A issues 100 paper pesos, backed with miscellaneous assets with a combined value of 100 ounces of silver, then those pesos will be worth 100 ounces even if bank B starts issuing derivative pesos on fractional reserve principles. Bank B's actions do not affect bank A's assets or liabilities, so they do not affect the value of the bank A's pesos.
  I haven't read Soto, but I suppose he doesn't say anything that isn't in Mises, which I have read. Mises did not understand the real bills doctrine, and that has left modern-day Austrians in the awkward position of calling themselves libertarians, while advocating some very unlibertarian restrictions on fractional reserve banking and central banking.
  

  Published: May 26, 2008 8:58 PM

• newson

  mike sproul says:
  "The grocer notes may or may not trade at a discount, but they would still be usable as money in either case."

  but the greengrocer's notes are fiduciary instruments and the money is his fruit/veg.

  "The dollar is, however, financially convertible. The Fed does, in fact, stand ready to buy back your dollars with a dollar's worth of bonds."

  there is no mechanism that enables the above.

  Published: May 27, 2008 1:17 AM

• Fred Furash

  Mike Sproul, while some (you could call "vulgar") libertarians certainly advocate a forced gold standard, I think you will find most people on this website to be for free banking. In other words, if a bank decides to inflate its own currency and use fractional reserves, it can do so, as long as there's a free market for currencies.

  
  "If bank A issues 100 paper pesos, backed with miscellaneous assets with a combined value of 100 ounces of silver, then those pesos will be worth 100 ounces even if bank B starts issuing derivative pesos on fractional reserve principles. Bank B's actions do not affect bank A's assets or liabilities, so they do not affect the value of the bank A's pesos."

  This can happen only if they use different currencies. If they use the same currency, then it doesn't matter who prints it, since the face value printed on the paper money is the same. In fact, that's the whole argument against central banks injecting money, that while normal money is obtained through hard work (represented by wine), the central banks inject money with almost no economic effort (represented by water) and thus dilute the entire pool. It bears no relevance whether or not the people who worked for their money can back it up by assets. The law of diminishing marginal utility applies to money, and it doesn't matter where the extra amount was created, by bank A or B, only that the ratio of money relative to the goods and services provided has increased, and is thus inflationary. I'm not sure how you have reasoned that out tbh, but unless they operate on different currencies, you seem to be pushing a very strange argument indeed. What makes fractional reserve banking a scam is that the backed money, and the ex nihilo money have the same face value, and represent multiple claims to the same assets.

  Published: May 27, 2008 5:01 AM

• Fred Furash

  Hmm, I've been reading more about the Real Bills Doctrine (which I've only found out from your post, so thanks for that).

  It seems that it in essence is based upon the age old fallacious premise that you can create wealth out of nothing. In other words, printing up money is somehow going to increase the amount of wealth in the economy. The fact is, real wealth is the goods and services produced, and money is just a claim on wealth. Increasing derivatives or claims does not increase the derived-from goods and services, it only devalues the derivatives.

  If I understand it right, the RBD fundamentally confuses a car (a good) with the picture of a car (money). The same thing Monetarists, Keynesians, Neoclassicals, and pretty much every other mainstream economists have done over the last few centuries, and it seems (if you read de Soto) for millenia. It's amazing just how harmful this fallacy has been to entire nation's, and individual people's prosperity.

  I seriously recommend you do some more studying on the subject, and read that de Soto book. Whatever Mises did, he never made a book of detailed historical accounts starting with ancienct greece about how fractional reserve banking was used to create the boom-bust cycle, at least afaik.

  Published: May 27, 2008 5:44 AM

• TLWP Sam

  Actually why wouldn't a single standard of precious commodity money not occur? How would an economy run when a grocer would have to post prices in gold, silver, platinum, diamond, rubies, tobacco, cowrie shells, etc.? Would there be a full-time worker constantly monitoring and posting the various exchange rates for the various 'currencies'. I do believe Libertarians have pointed out that the competition as to which precious commodity should be money was battled out long ago and the winner is gold and the runner-up is silver. So isn't it simply a choice between paper money and gold & silver coinage?

  Published: May 27, 2008 6:10 AM

• Mike Sproul

  Fred Furash:

  "It seems that it in essence is based upon the age old fallacious premise that you can create wealth out of nothing. In other words, printing up money is somehow going to increase the amount of wealth in the economy."

  No; the rbd says that the value of money is equal to the value of the assets backing it, so that if a bank issues 10% more money, at the same time that it gets 10% more assets, then the money will hold its value. Of course, if an economy has been deprived of money, then introducing money can alleviate the inconvenience of barter, and thereby create a certain amount of wealth, but that's the only sense in which the rbd implies that printing money creates wealth.

  "The fact is, real wealth is the goods and services produced, and money is just a claim on wealth. Increasing derivatives or claims does not increase the derived-from goods and services, it only devalues the derivatives."

  Actually, increasing derivatives doesn't even devalue the derivatives. For example, the price of call options on GM stock will be the same whether there have been 1 million calls issued or 2 million. In the same way, a checking account dollar is a call option on a green paper dollar. As more checking account dollars are issued, there is no effect on the value of either the checking account dollars or the green paper dollars.

  Also: It is the quantity theory, not the rbd, that is guilty of the "something for nothing" fallacy, since the qt accepts the existence of fiat money, while the rbd says that all money is backed by the assets of the issuer.

  Published: May 27, 2008 9:46 AM

• Suffering Group

  
  APPEAL FOR JUSTICE TO SAVE FROM OPPRESSIVE LAWS

  Dear Sir
  From 1972 after independent ,Bangladeshi Nationals started to Established Industries investing family resources ,adopting innovative technology as SELF EARNER & to create job for million of unemployed & to achieve economic freedom when everything were damaged and leftover .
  Government also start helping these fast growing PRIVATE SECTOR INDUSTRIES with fund received from International Grant / Loan giving Agencies and stated to distributed through different Bank. From 1980 period..
  But unfortunately Owner of Industries becomes victims of deep rooted conspiracy & Anti Propaganda .. The Bank Official refrain themselves from ascertaining production capacity of imported machineries and to provide required working capital loan in time extending total non-cooperation, negligence or even were reluctant to receive back their loan money if any Industrial Owner decided to pay back the loan for non-banking activities These have been done willingly to Jeopardize the Government Decision & Policy of Privatizations as well to occupy the mortgaged properties of the Owner of The Industries
  In this way Hundreds & Thousand of Industries in Bangladesh have been destroyed by Bank Officials & Policy Maker who are not aware of First Changing Technology of the World even .
  Due to Such Conspiracy , Negligence’s , Fraudulent Activities including Non - Banking Activities of Bank Official & Policy Maker, most of the these Industries have became in-operative or closed & have lost their Cash Capital, Expatriate Capabilities. And became helpless victims of such deep rooted conspiracy. Having no Legal Protections and remedies throwing large number of WORKER & STAFFS - JOBLESS who were engaged in these Industries for their livelihood.
  In 1992 &1996 the Sick Industries Rehabilitation Cell were formed by GOVERNMENT OF BANGLADESH & have Identified and Registered these Industries as SICK INDUSTRIES declaring not as defaulter but victims of Violation of Contract, Negligence, Fraudulent Activities, Malpractices of Bank Officials including Policy Maker. And due to lack of Accountability at most of the organization of Bangladesh which are no more hidden matter .
  THE OWNER OF THE INDUSTRIES OF BANGLADESH ARE LOOKING VERY DESPERATELY FOR JUSTICE BUT THE DOOR OF JUSTICE ARE CLOSED FOR UNKNOWN REASONS.
  The owner of Industries of Bangladesh are deprived of Legal Right due to enactment ARTHA RIN ACT ACT ( Money Landing Act ) on 1989 which were amended several time till 2007 and Bankruptcy Act on 1997 treating the OWNERS OF INDUSTRIES SECTOR as like as SLAVE of Primitive Age.

  But these laws are not applicable in Nationalized Sector where Billions of Dollars are invested t an unaccounted till today .
  Total outstanding Defaulted Bank Loan are about 60 to 70 % lying with Government Sector / Nationalized Concern
  And less then 10 % Bank loan are lying with Small & Medium Size Industries of Private Sector & Bank Official can explain well about the balance of the remaining out standing Loan.

  LAW OF TORTS and LAW OF CONTRACT ARE MOST COMMON LAW IN ALL COUNTRY and even in our NEIGHBOURING COUNTRIE, BUT NOT APPLICABLE IN BANGLESH YET DUE TO WHICH BANGLADESH HAS BECOME A HEAVEN FOR REPRESSION / EXPLOITATION forcing the Process of increasing - Poverty line in Geometric Ration .

  OWNER OF INDUSTRIES OF PRIVATE SECTOR CAN NOT CLAIM ANY COMPENSATION OR SET OFF on the Suit filed by the Bank Official or Loan Giving Agencies FOR VIOLATION OF CONTRACT, NEGLEGIENCES, MALPRACTICES, including fraudulent activities of Bank officials instead of huge loss and damages although Bangladesh is known as DEMOCRATIC COUNTRY and never was a COMMUNIST COUNTRY.
  CONDITION OF SICK / DISTRESSED INDUSTRIES are deplorable due to lack of Accountability of Bank Official / Policy Maker & total Indemnity offered to Bank Official / Loan Giving Agencies These have been done to hide out existing high profile Malpractices, Corruption and Fraudulent Activities & Negligence as per opinion of Expert Personals depriving the Owner of Industries from Justice .
  Also Common PEOPLE WHO ARE FACING ANOTHER TYPE OF REPRESSIVE UNDER CERTIFICATE CASE for realization of Taxes , Agricultural Loan , including Weaver’s Loan etc.
  The Owners of Industries in Bangladesh have no legal right to protect themselves and from the oppression of Bank Official & Policy Maker & Officials which are no more hidden matter rather a part of deep rooted conspiracy till date helping the process of HUMAN TRAFFICKING .
  Bank official have given absolute Indemnity for Violation of Contract , Negligence Malpractices & Fraudulent Activities
  OWNER OF INDUSTRIES can only file a separate suit for compensation in separate CIVIL COURT CREATING MORE complicacy for life long litigation WITH OF NO RESULT due to restriction to obstruct or resist any order / decree of ARTHA RIN ACT / COURT by any other DECREE OR ORDER OF OTHER COURT or even of by HIGHER COURT. THE RIGHT OF EQUITY OF LAW HAVE COMPLETELY BEEN DENIED TO THE INDUSTRIAL ENTREPRENEUR OF PRIVATE SECTOR IN BANGLADESH

  Sections 12, 12 ( khan ) 18 ( 2 ) & (3 ) 19, 20, 21, 34,40, 41, 42, 44, 47 and 50 of ARTHA RIN ACT are directly repressive types violating of ARTICLE NO : 8, 15, 26 and 27 of BANGLADESH CONSTITUTION and self contradictory to the policy of Government to resist Malpractices and Corruption and Privatization programmed ax Mentioned in Industrial Policy adopted time to time having no force of law at all.

  Now there are no other alternative way but to draw the kind attention of Concerned Authority Including International Community / Organizations seeking help for JUSTICE and Support to save & protect the OWNER OF SICK OR DISTRESSED INDUSTRIES OF Bangladesh under Private Sector, including their properties from such deep rooted conspiracy and oppressive laws as well to protect the interest of large number of workers, staffs of the Private Sector and also for CHANGE of such oppressive laws to restore Accountability of Bank Official / Loan Giving Agencies including Policy Maker to ensure for National Interest

  ( A ) - Humble appeal before the Government of Bangladesh to kindly allow Industrial Entrepreneur to claim Set Off or Compensation on suit filed by the Bank or loan Giving Agencies. or allow to Run Compensation Suit Simultaneously with suits file by Bank Officials under ARTHA RIN ACT with equal opportunity and equal right so as to restore total accountability .

  (B)- Considering the Heavy loss and Damages of Government Registered and Identified SICK INDUSTRIES of 1992 & 1996 of Private Sector since last 25 years due to Non-Banking Activities of Bank Officials and Policy Maker may kindly be allowed 100 % weaver of all type of Bank loan liabilities to minimize their heavy loss and damages to certain extent

  ( C )- The system of keeping mortgage of Land & Properties from the Owner of Industries by Bank or any Loan Giving Agencies as Securities are mostly responsible for Malpractices and ever growing Corruption, & Fraudulent Activities in Banking Sector, which are now proven matter and may kindly be completely abolished as a part of reform programs at earliest possible time to ESTABLISH ACCOUNTABILITY and Check Malpractices, Fraudulent Activities which are now growing by large in Banking Sector or in other Loan Giving Agencies upto root Levels

  ( D ) - All suits of Artha Rin Court may kindly be transferred to Civil Commercial Court providing Equal right for the end of Justice or preferably be stopped unconditionally

  
  AND

  The above mentioned Sections 12, 12 ( khan ) 18 ( 2 ) & (3 ) 19, 20, 21, 34,40, 41, 42, 44, 47 and 50 of ARTHA RIN ACT may kindly be abolished immediately to unearth y & check existing Negligence , Malpractices & Fraudulent Activities of Banking Sector.

  ( E ) – And Section 28 ( Ka ) of BANKING COMPANY of 2001 which explain WRITTEN OFF does not mean Weaver were included just to or misguide the International Community & Bangladesh National so as to serve the interest of the Vested Group & to hide out the above also

  ( F ) And also take immediate steps to reform or abolished the system of CERTIFICATE CASE Which are nothing but abuse of Law for realizing Government Taxes , Agricultural Loan etc and is one of the worst system of CLONIAL RULE

  ( G ) - It would be an extreme favors if your good self kindly collect the PRINTED COPIES OF THE ABOVE MENTION LAWS for confirmation of mentioned facts .& to help the Suffering Groups by circulating this appeal among Honorable Member of your Organization and Partner’s Organizations & to Publish in WEBSITES or News Bulletin or News Media, Electronic Media of your territory to bring to the knowledge of Concern Authority including International COMMUNITY OR ORGANIZATIONS working for HUMAN RIGHT & FUNDAMENTAL / Democratic Right of People to prevent legal abuse for immediate help and support to protect the Owner of the Sick Industries / Distressed Industries of Bangladesh and their properties from such OPPRESSIVE LAWS for which they all would be ever grateful as well for change of all types of oppressive laws restoring accountability at all organization of Bangladesh.
  
  ********* N.B. the Summery of above mentioned Section of Artha Rin Act at a Glance:

  (A)- In section 18 ( 2 ) & ( 3 ) Defendant or Owner of Industries will not be able to claim any set – off or to make counter claim against the Bank or Bank Official nor will be allowed to claim any Compensation by submitting any Suit against Bank ( Plaintiff ) analogously or simultaneously in Artha Rin Court due to violation of contract, fraudulence activities including negligence, malpractices of Bank officials.
  (B)- Section 21: Settlement Conference between Borrower and Bank is a misnomer of Law of Arbitration or just to divert the attention of common people in the name arbitration or to make everybody fool .
  (C) -As Per Section 19 (6) of Artha Rin Act of 2003 no suits can be declared to be dismissed or discharged for default or above mentioned fault of Bank Official. As per Section 20 regarding any order or proceedings of Artha Rin Act can not be raised to Higher Court or to any Other Superior Authority without paying 50 % of claimed or Decretal Amount if the order is totally misleading or against any law or illegal one even .
  (D) - As per Section 34 Defendant or the Owner of Industries in Artha Rin Adalat Case can be put to the Jail for compelling or forcing him to pay the Bank Money without considering the fault or negligence’s of Bank Official without allowing him to proof the matter of violation of contract, fraudulence activities , negligence, malpractices of Bank officials. V- As per section 41 and 42 -The Owner of Industries are not allowed to file any appeal or revision to High Court or Superior Court against any order of Artha Rin Court without paying 50 % of the claimed amount or Decretal amount in advance , But the Bank Official are not require to pay any amount in advance in the Higher Court, allowing A Great Disparity of Law and Justice.
  (E) - Under section 47 and 50 , The learned Court under Artha Rin Act of 2003 have been bared to make any exemption of principal loan amount for Violation of Contract , Negligence’s Malpractices, including fraudulent activities or any fault of the bank official uni laterally

  (F)- Section 12 ( Kha ) Imposed a bar for filling write petition to Higher Court which are direct violation of human right and constitutional right of the citizen and reflects the negative attitude of Policy Maker and the Law Maker .

  Suffering Groups of Owners of Industries of Bangladesh under Private Sectors

  
  

  Published: October 27, 2008 4:29 AM