Editing Monetary reform (section)

===Government Control vs Central Bank independence===
To regulate credit creation, some countries have created a [[currency board]], or granted independence to their [[central bank]].  The [[Reserve Bank of New Zealand]], the [[Reserve Bank of Australia]], the [[Federal Reserve]], and the [[Bank of England]] are examples where the [[central bank]] is explicitly given the power to set interest rates and conduct monetary policy independent of any direct political interference or direction from the [[central government]]. This may enable the setting of interest rates to be less susceptible to political interference and thereby assist in combating [[inflation]] (or debasement of the currency) by allowing the [[central bank]] to more effectively restrict the growth of [[money supply|M3]].<ref>[https://mises.org/story/2810 Manipulating the Interest Rate: a Recipe for Disaster], by Thorsten Polliet, December 2007</ref>

However, given that these policies do not address the more fundamental issues inherent in fractional reserve banking, many suggest that only more radical monetary reform such as government directly taking over central banks such as the China or Swiss models can promote positive economic or social change.  Although [[central bank]]s may appear to control inflation, through periodic bank rescues and other means, they may inadvertently be forced to increase the [[money supply]] (and thereby debase the currency) to save the banking system from bankruptcy or collapse during periodic bank runs, thereby inducing [[moral hazard]] in the financial system, making the system susceptible to [[economic bubble]]s.<ref>[http://www.rgemonitor.com/blog/roubini/210283/ Moral Hazard Effects of Central Bank Intervention] {{webarchive|url=https://web.archive.org/web/20080324142328/http://www.rgemonitor.com/blog/roubini/210283 |date=24 March 2008 }}, by [[Nouriel Roubini]]</ref>