Stupid World

[yokel]

lol, my eyes, my eyes.

Oh you want me to stop pissing in them? Haha,

[mashman]

They don't hold the deposits, they have lend the deposits out. Transaction 2 is able to put in 80 because 80 was lent out to them from transaction 1. Or are you thinking the subsequent transactions are from new people?

Let's just focus on showing how that 100 gets turned into 500, cos it still looks like 100 to me.

In the example you put forwards, the 80 goes to bank B who lends 64 to bank C... and throughout the chain the deposits go into the banks before being loaned out and those loans are bank assets.

[mashman]

Oh you want me to stop pissing in them? Haha,

I'd appreciate it lol.

[bogan]

In the example you put forwards, the 80 goes to bank B who lends 64 to bank C... and throughout the chain the deposits go into the banks before being loaned out and those loans are bank assets.

Loans are bank assets, as deposits are bank liabilities; think about it from the banks perspective, every time they loan money out they take money from bank wallet and give it to somebody else to return later, ie, a deposit with somebody else. The 100 goes to bank A who then loans 80 to bank B leaving bank A with only 20 (which they can't touch anyway). The only way for bank A to retain that 80 for later use would be if they copied it before sending it to bank B (which would be money printing) which doesn't happen of course.

[yokel]

I'd appreciate it lol.

would you appreciate 100 bucks instead??

[mashman]

Loans are bank assets, as deposits are bank liabilities; think about it from the banks perspective, every time they loan money out they take money from bank wallet and give it to somebody else to return later, ie, a deposit with somebody else. The 100 goes to bank A who then loans 80 to bank B leaving bank A with only 20 (which they can't touch anyway). The only way for bank A to retain that 80 for later use would be if they copied it before sending it to bank B (which would be money printing) which doesn't happen of course.

Bank A has the loan asset of 80... call it a copy if you like.

would you appreciate 100 bucks instead??

Nah, I can sell the promise of my arse for more.

[bogan]

Bank A has the loan asset of 80... call it a copy if you like.

It isn't a copy as they cannot do anything with it unless it is paid back. It is an asset though, which is why the money multiplier term is a thing, but it is an asset offset by a debt, and thus not an asset that is immediately accessible.

[mashman]

It isn't a copy as they cannot do anything with it unless it is paid back. It is an asset though, which is why the money multiplier term is a thing, but it is an asset offset by a debt, and thus not an asset that is immediately accessible.

You can't leverage against an asset?

[bogan]

You can't leverage against an asset?

No, because it doesn't work very well when it is offset by such a liability.

[yokel]

Nah, I can sell the promise of my arse for more.

Dan it! ok I'll have to run down to the bank and borrow some more money if I want to continue using your services haha

[Brian d marge]

Loans are bank assets, as deposits are bank liabilities; think about it from the banks perspective, every time they loan money out they take money from bank wallet and give it to somebody else to return later, ie, a deposit with somebody else. The 100 goes to bank A who then loans 80 to bank B leaving bank A with only 20 (which they can't touch anyway). The only way for bank A to retain that 80 for later use would be if they copied it before sending it to bank B (which would be money printing) which doesn't happen of course.

I have already posted a clear outline pointing out how it works

I will also post links

Also as banke moon on record as saying banks print miney

But hey dont take my word

Google money supply nz
Money creation new zealand

And fractional reserve banking

And yes debt is an asset why do you think student loans are so popular

Stephen

[bogan]

I have already posted a clear outline pointing out how it works

I will also post links

Also as banke moon on record as saying banks print miney

But hey dont take my word

Google money supply nz
Money creation new zealand

And fractional reserve banking

And yes debt is an asset why do you think student loans are so popular

Stephen

It is not clear unless you show figures as well, same goes for the links you may suggest. The figures I've shown are simple, largely self explanatory, and not ones you can contradict; interpretations of the whole kabang are, well, often open to interpretation.

[mashman]

No, because it doesn't work very well when it is offset by such a liability.

One of the reasons austrian school economists have issues with FRB

[Brian d marge]

It is not clear unless you show figures as well, same goes for the links you may suggest. The figures I've shown are simple, largely self explanatory, and not ones you can contradict; interpretations of the whole kabang are, well, often open to interpretation.

See my post about interest

There maybe something in the budget rbnz but im on a smartphone in dennys . . .

B moon ill try and find now

[Brian d marge]

https://www.google.co.jp/url?sa=t&so...vqDH8EnIWMnFzw

Cant get any moredefinitive than the bank of england explaination of how money is created
All of which i have pointed out
Except the the use of loans to created new money which is then loaned out at the fractional reserve rate which in turn creates more new money
This is held in check . . .kind of
By the inflation rate
Which is why the frb introduced a new law in 2008 allowing interest to be paid on central bank reserves allowing new money toenter the system without increasing the inflation rate . ,which it would if it was just dumped or released into the economy

Which i think is clever

Unfortunately due to the removal of the glass seagal act banks can now speculate
Omg look at the stock market, . . . .
Omg look at gold and silver prices

When i get home illl try to find ban ki moon on printing . .i posted it as a reply to ocean1 about a year ago

If ya still dont believe me . ,sharp 7 even ran a clip about banks printing money