China lets yuan break 7-per-dollar level for first time in over a decade

Re:China lets yuan break 7-per-dollar level for first time i... by kgwgk on Monday August 05, 2019 @09:08AM (#20613853)

> And for monetary purposes, savings accounts are checking accounts

There are different definitions of money and saving accounts are included in M2 (“money and close substitutes”) but not in M1.

What about time deposits? For short maturities they are included in M3. And what about longer term depositss? Are banks creating money when they lend those out?

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Re:China lets yuan break 7-per-dollar level for first time i... by JumpCrisscross on Monday August 05, 2019 @09:13AM (#20613888)

> What about long-term deposits? Are banks creating money when they lend those out?

You're hanging on to the "banks lend out deposits" mental model. Stop that. The Bank of England has an accessible write-up on this: https://www.bankofengland.co.uk/-/media/boe/files/quarterly-....

Loans create deposits. Whether those deposits then end up in a checking account through a payroll service or a vendor's savings account through a payment for goods and then transfer is irrelevant.

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