There was a previous request for the same comm by /u/Ectrayn , so there is definitely some interest as well as people who could mod it (myself included, I suppose)
There was a previous request for the same comm by /u/Ectrayn , so there is definitely some interest as well as people who could mod it (myself included, I suppose)
I vouch for that, it would fit well in the learning category
One of the main purposes of a financial system is to ration funds from lenders to borrowers, thereby allowing these resources to be put to a more productive use to the economy as a whole than they would be stashed away under a mattress. In a capitalist system, a (commercial) bank operates by charging higher interest rates to the borrowers than they pay to those who hold money in their deposits, making a profit on that difference (the banking spread). The mechanism isn't exactly like this on an individual level (the money you borrow doesn't literally come from someone else's deposit) but its more or less true on the aggregate.
You can't really have commercial banking (and especially stock markets or derivatives) without private enterprise, since the whole system revolves around banks and other intermediaries trying to evaluate the future profits of firms, so they can get the biggest return without risk of default from the borrower.
The problem with the logic of the above paragraph is that, as someone on this site already might expect, the credit market doesn't necessarily allocate the investments that would lead to a country's development or increase its standards of living. So what many countries do (and socialist ones did) is to try to "manually" ration funds through the state by financing long term, low-interest loans to sectors of the economy which are compatible with the government economic policy for the following years (or their x-year plan, if you will). These are Development Banks, which often serve to nudge enterprise in the right direction rather than have an explicit profit motive.
This makes sense if you are a socialist party trying to develop the productive forces in a country through market forces, but not if you are in a centrally planned economy like the Soviet Union (in that case, the loans would be subsidies since they would just redistribute government funds for different uses).