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A comment on The Casino-Chip Society: a framework for understanding the politics of money. Parent comment
Yes, exactly. The key phrase here is
loans create deposits
When you take out a loan, the bank conjures the casino chips from thin air and increases the numbers in your bank account.
Eventually the bank's reserves at the central bank need to be a percentage of their liabilities
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Yes, exactly. The key phrase here is
loans create deposits
When you take out a loan, the bank conjures the casino chips from thin air and increases the numbers in your bank account.
Eventually the bank's reserves at the central bank need to be a percentage of their liabilities