But printing it is also creating it? I don't see the difference in meaning you suggest.

Well as a simple matter of fact, banks don't have the right to print banknotes, they merely create electronic deposits and then if someone wants to turn those into banknotes the banks have to borrow them from the Fed (or local equivalent). The more important difference this represents is that money is "created" as loans, with the bank's profit being the difference between the total amount that gets repaid to the bank by some creditworthy private person or organization and the amount the bank owes the Fed. So (i) the bank doesn't get to spend the money it "creates", it's actually reserves the bank owes to whoever's deposit account the money ends up in and (ii) it's a market-driven process where the bank is only incentivised to create money if prospective borrowers are demanding loans and the bank believes they will be able to repay them. (And the Fed in turn, "creates" and "destroys" money to the extent necessary to ensure the market interest rate is at a desired level, not to make profits or pay bills)

The uninformed school of internet libertarianism likes to conflate this process of credit creation with the practice of unstable governments realising they'll never be able to raise enough money from taxes or oil sales to pay for the mansions and five star generals they'd like to buy and so printing some more banknotes (not owed to anyone) to be a bit richer.

I provided the link with minimal commentary because the concept of money is one of those black magic things that is difficult for me to explain because it does put me out of my depth trying to keep the technical jargon straight and I’m never 100% sure about my own grasp; but making my best effort in good faith to try and explain it and keeping it as simple as is possible for me: a printed dollar is just a representation of $1, specifically it is a $1 Federal Reserve bank note documenting a dollar that is backed by the financial assets that are pledged as collateral by the Fed’s owners. Wikipedia says this is mostly Treasury Notes (debt instruments of the US government) and mortgage agency securities (relying on Wikipedia again, these are securities issued by Ginnie Mae, Fannie Mae, Freddie Mac or the Federal Home Loan banks).

What’s important to understand to make any sense of this is that when the bank issues you a loan, that sits on their Balance Sheet as an asset, and on your balance sheet as a liability, so when the bank issues you say $50K in the form of a Loan so you can buy a car and it is deposited into your account, USD$50,000.00 was created as money, but that doesn’t mean $50K of notes was printed. What changed is the following: the Bank’s assets increased by $50K balanced against its liability accounts, and your liabilities increased by $50K balanced against your asset accounts until you pay the money back.

There’s a lot more money than there is currency in circulation, and currency represents one type of money. It’s not a difference of one being physical and one being digital because all of it is documented somewhere whether it’s a PDF of a loan agreement and resulting statements or the cocaine-coated bills and coins in your pocket; they’re subtly distinct concepts of put another way, money is intangible but can be created and bank notes and promissory notes are tangible forms of it documenting money and can be printed. Taking it back to the Fed, actual paper money in circulation is considered a liability against the Fed’s assets which are other people’s (well, institution’s really) debts to the Federal reserve, and I think this is the point where I have to stop because I’m already out of my depth and taking it much further will put me way out into the deep end. Corrections and expansions from others welcome.

Also note that somebody replied to me above with a link to the Bank of England talking about money creation. I haven’t had the chance to read it, but it’s probably worth checking out as well.

That's not the process. The process is that loans create deposits.

This is the process. From an actual central bank [0] [0]:https://www.bankofengland.co.uk/-/media/boe/files/quarterly-...