Disruptors What Banks Don't Want You to Know with Paul Withers of Direct Bullion
May 26, 2025
Paul Withers, owner of Direct Bullion, sheds light on the hidden truths of the banking system and offers insights into alternative investments like gold. He discusses how depositing money turns savers into creditors and the looming threat of a cashless society. With alarming statistics, he reveals the recent surge in bank collapses and the dangers of relying on traditional banks. Paul advocates for investing in physical gold as a safeguard against financial instability and challenges the ethical implications of monopolized currency and consumer choice in today's economy.
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Banks Own Your Deposits Legally
- When you deposit money in a bank, the money legally becomes the bank's, and you become a creditor with a debt owed to you by the bank.
- Banks only keep a small fraction of deposits in reserve while lending or investing most of the money, risking liquidity issues with runs or bail-ins.
Inflation Erodes Savers' Wealth
- Inflation consistently exceeds bank interest rates, causing everyday savers to lose money over time.
- This silent wealth transfer flows from savers directly to the banking system, not just rich elites.
Fractional Reserve Banking Explained
- Banks operate under fractional reserve banking, legally required by regulations to keep as little as 4% of deposits in reserve.
- This means 96% of deposited money can be lent or invested, amplifying financial system risks.
