Re:The digital pound: A new form of money for households and...
by bernawil on Wednesday February 08, 2023 @10:14AM
(#34709145)
> fundamentally the incorrect claim that banks lend out their depositors funds
Typical arguments against this always end up in "they do lend out their depositors funds" with extra steps.
deposits go to their balance sheets as assets and a liability towards the depositor. Banks do business with their assets and some of that business might put their balance sheet in a position where they can't or won't honor their debt to depositors. At that point whether they "lent out depositor's funds" is philosophical.
Typical arguments against this always end up in "they do lend out their depositors funds" with extra steps.
deposits go to their balance sheets as assets and a liability towards the depositor. Banks do business with their assets and some of that business might put their balance sheet in a position where they can't or won't honor their debt to depositors. At that point whether they "lent out depositor's funds" is philosophical.