Re:The Fed stalls the creation of a bank with a novel busine...
by neilwilson on Saturday September 22, 2018 @05:30PM
(#18048113)
What do you buy capital
Bonds/ equity with?
Bank deposits. The more deposits there are the more demand there is for bank capital in aggregate.
The system reaches an equilibrium at a price not a quantity. The quantity floats as required by the price of money.
Reserves are always available since the other banks lend them out and the central bank as lender of last resort. They have no control function in quantity. Only in their price.
Bank deposits. The more deposits there are the more demand there is for bank capital in aggregate.
The system reaches an equilibrium at a price not a quantity. The quantity floats as required by the price of money.
Reserves are always available since the other banks lend them out and the central bank as lender of last resort. They have no control function in quantity. Only in their price.