There is, of course, a concept of simply saving money (not investing), which is a perfectly reasonable and desirable thing for most people to do. Today, one cannot simply save money (the thing you are calling a bad investment) because of perpetual inflation/money creation/bailouts. This makes saving money a losing game. You apparently hold the belief that people willfully choose to hold investments rather than simply saving money. This is absolutely false, and it shows how wildly out of touch you are with the average person. But you are an academic, so perhaps that should be expected. The average person wants to do their job and save money (in the form of a money that maintains its purchasing power). The average person has no interest in becoming an amateur portfolio manager on nights and weekends. The average person doesn't want to perpetually buy ETFs, stocks, and new pieces of real estate just to keep the wealth they *already* earned. Again, if you cannot comprehend these things, you are simply out of touch with the vast majority of the population. Your free banking theory has some giant holes it in. Your beloved free fractional reserve banks are not stable. They are prone to bank runs and financial crises. And when those inevitable runs and crises happen, what do you expect politicians/central bankers to do? Just sit by and tell Grandma and Aunt Sally that they lost all their money but they should have been better credit analysts? Of course this is not what happens. Instead we get the cycle of broad money creation followed by bailouts and base money creation, repeat ad infinitum. Then people like you try to rationalize it away by saying "oh of course people don't hold bank money because it's not a good investment." Total nonsense. The forest is beautiful, George. You might be able to see it one day if not for those pesky trees.