By "developed", read "socialist". And, yes, socialist economies can't function well without such abominations.
Plank 5 of the Communist manifesto:
"Centralization of credit in the hands of the state, by means of a national bank with State capital and an exclusive monopoly."
Inasmuch as the US has veered into the same foolish territory as these other "developed" nations in Europe, that is why such a ridiculous system exists here as well.
Deficit spending via fractional reserve banking is an indispensable tool for advancing socialism, but I fail to see its necessity in any economy where government spending is under any kind of reasonable control.
In the absence of such a system, government spending simply could not be as runaway as it is.
That is why such a system exists, along with the added benefit of enriching those who are collecting the interest on the loans.
Fractional reserve banking is the most ludicrous thing I've ever heard of in my life, and there is no reason for it other than to rationalize the unending and unchecked expansion of government.
“By “developed”, read “socialist”.
Countries with central banks. England in 1690. William III was a Socialist, who knew?
France, Canada, Japan, New Zealand, Germany, Australia, Columbia, Mexico, Chile... good grief, the Soviet Union was surrounded by Socialists! Good thing Gorbachev didn’t know!
“Deficit spending via fractional reserve banking”
Deficit spending is possible without fractional reserve banking, contrary to your fantasy that the two are necessarily linked. Deficit spending means nothing more than spending in excess of tax revenues and borrowing to cover the difference.
“That is why such a system exists, along with the added benefit of enriching those who are collecting the interest on the loans.”
Gosh. I guess the fact that widespread bank failures occurred during economic downturns in countries without central banks, and far fewer bank failures occurred in countries with them had nothing to do with the decision to adopt them. Just one of those amazing coincidences.
“Fractional reserve banking is the most ludicrous thing I’ve ever heard of in my life, “
Probably because you’re completely ignorant about banking. Fractional reserve banking is the very definition of banking as von Mises points out in his “Theory of Money and Credit” which I’m certain you’ve never read and likely never even heard of. Fractional reserve banking dates back to 15th century Germany and the beginnings of banking. You can cure your confusion by reading Ehrenberg’s “Capital and Finance in the Age of the Renaissance: A Study of the Fuggers, and Their Connections” which is still in print.