FDIC Takes over Silicon Valley Bank

Re:FDIC Takes over Silicon Valley Bank by refurb on Friday March 10, 2023 @08:22PM (#35104001)

Dollars are bank notes “promises to repay”. It used to be many different bank issues notes payable in gold, now it’s one bank - the Fed, and it’s no longer gold.

It doesnt matter if the US dollars is held outside the US. The dollar represents a promise by the fed to pay, and thus is a liability to the fed.

Of course the fed has the power to create and destroy dollars.

[ Parent | on HN ]

Re:FDIC Takes over Silicon Valley Bank by wins32767 on Monday March 13, 2023 @05:13PM (#35142764)

> Of course the fed has the power to create and destroy dollars.

So to banks outside the US. That's how fractional reserve banking works. If I go to the UK and deposit $1m USD, and they loan out $900k of that to you, that UK based bank has created $900k.

[ Parent | on HN ]