The State Causes the Poverty It Later Claims to Solve

http://mises.org/daily/6604/The-State-Causes-the-Poverty-It-Later-Claims-to-Solve

The current system of fractional reserve banking and central banking stands in stark opposition to a market economy monetary regime in which the market participants could decide themselves, without state pressure or coercion, what money they want to use, and in which it would not be possible for anyone to expand the money supply because they simply choose to do so.

The expansion of the money supply, made possible through central banks and fractional reserve banking, is in reality what allows inflation, and thus, declining income in real terms.