18 Dec 2017 3:46 pm
charles.thompson » 18 Dec 2017 2:24 pm » wrote: So basically you are admitting that anyone who took an econ 101 class knows that private banks cannot simply print money to pay their debt. I agree.
What is all this other irrelevant nonsense?
I mean did you study SO MUCH ECON that you lost the ability to make a point? Because I see you making more claims about conservative radio than economics.
...charles, save yourself...little do you know but you're waaaaaaay out of your league with me...you're still stuck back in the 'printing of money' by 'the government' myth...ugh...[hint for other blow-dried phony 'economists' around here: most all money today is not the 'printed' green ragcloth paper rectangles emblazoned with dead republicrats...most/all money today is a number in a **** computer...and believe me, you republicrat money dummies would be shocked!! if you ever got it through your thick skulls how these number$ originate.....]
BTW, CHARLES!!...CAN YOU PROVIDE ANY LINKS TO BOLSTER YOUR "DON'T-KNOW-WHAT-A-DOLLAR-IS-BUT-I-LIKE-TO-WORK-MY-HOLE-ABOUT-THE-ILLION-DOLLAR-ECONOMY" OPINIONS?? CAN/WILL ANY OF YOU REPUBLICANS PROVIDE ANYTHING/ANYONE THAT YOU AGREE WITH?!..
[DIDN'T THINK SO]...YOUR HOLES ARE CONSTANTLY WRITING CHECK$ YOU CAN'T COVER....http://www.rpoth.at/docs/modern_money_mechanics_us.htmlWho Creates Money?
Changes in the quantity of money may originate with actions of the Federal Reserve System (the central bank), depository institutions (principally commercial banks), or the public. The major control, however, rests with the central bank.
The actual process of money creation takes place primarily in banks.(1) As noted earlier, checkable liabilities of banks are money. These liabilities are customers' accounts. They increase when customers deposit currency and checks and when the proceeds of loans made by the banks are credited to borrowers' accounts.
In the absence of legal reserve requirements, banks can build up deposits by increasing loans and investments so long as they keep enough currency on hand to redeem whatever amounts the holders of deposits want to convert into currency. This unique attribute of the banking business was discovered many centuries ago.
It started with goldsmiths. As early bankers, they initially provided safekeeping services, making a profit from vault storage fees for gold and coins deposited with them. People would redeem their "deposit receipts" whenever they needed gold or coins to purchase something, and physically take the gold or coins to the seller who, in turn, would deposit them for safekeeping, often with the same banker. Everyone soon found that it was a lot easier simply to use the deposit receipts directly as a means of payment. These receipts, which became known as notes, were acceptable as money since whoever held them could go to the banker and exchange them for metallic money.
Then, bankers discovered that they could make loans merely by giving their promises to pay, or bank notes, to borrowers. In this way, banks began to create money. More notes could be issued than the gold and coin on hand because only a portion of the notes outstanding would be presented for payment at any one time. Enough metallic money had to be kept on hand, of course, to redeem whatever volume of notes was presented for payment.
Transaction deposits are the modern counterpart of bank notes. It was a small step from printing notes to making book entries crediting deposits of borrowers, which the borrowers in turn could "spend" by writing checks, thereby "printing" their own money..."
...
The study of money, above all other fields in economics, is one in which complexity is used to disguise truth or to evade truth, not to reveal it.
John Kenneth Galbraith, Money: Whence it came, where it went (1975), p. 15.The process by which banks create money is so simple that the mind is repelled.
John Kenneth Galbraith, Money: Whence it came, Where it Went p. 29.The modern banking system manufactures “money” out of nothing; and the process is, perhaps, the most, astounding piece of “sleight of hand” that was ever invented. In fact, it was not invented. It merely “grew”. … Banks in fact are able to create (and cancel) modern “deposit money”, just as much as they were originally able to create, or call in, their own original forms of private notes. They can, in fact, inflate and deflate, i.e., mint, and un-mint the modern “ledger-entry” currency.
Angas, Major L. L. B. (Lawrence Lee Bazley) (1937). Slump ahead in bonds. Somerset Pub. Co.. pp. 20-21. OCLC 3506072.The actual process of money creation takes place in commercial banks. As noted earlier, demand liabilities of commercial banks are money. … Confidence in these forms of money also seems to be tied in some way to the fact that assets exist on the books of the government and the banks equal to the amount of money outstanding, even though most of the assets themselves are no more than pieces of paper...
Federal Reserve Bank of Chicago; Nichols, Dorothy M (1961). Modern Money Mechanics; a workbook on deposits, currency and bank reserves.. p. 3. OCLC 510802.The 1992 revision of this booklet is available on wikisourceCommercial banks create checkbook money whenever they grant a loan, simply by adding new deposit dollars in accounts on their books in exchange for a borrower's IOU.
Federal Reserve Bank of New York; Friedman, David H. (1977). I Bet You Thought.... p. 19. OCLC5356154.The 12 regional reserve banks aren't government institutions, but corporations nominally 'owned' by member commercial banks.