3 ms·
Banks create money at the time someone gets a loan, and or risk is valued. Their reserve, deposits, determine the size of loan they can create.
by ddingus 8y ago
Banks create money at the time someone gets a loan, and or risk is valued.
Their reserve, deposits, determine the size of loan they can create.
- nazgulnarsil 8y agoI vividly remember trying to explain this to people during the financial crisis and people not being able to grasp it. I only learned it from being friends with an accountant who worked for a big bank.
- lucio 8y ago"Banks create money" (from thin air). That's the concept a lot of people struggle with.