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If you think money is just sitting in a bank account then you misunderstand how the economy works. Money in a bank gets reinvested by the bank and funds loans,
by Anon1096 7y ago
If you think money is just sitting in a bank account then you misunderstand how the economy works. Money in a bank gets reinvested by the bank and funds loans, mortgages, and credit. The only money that isn't moving is dollars literally stuffed under a mattress and what the bank keeps on hand to fulfill reserve requirements.
- b_tterc_p 7y agoSort of. Banks want to loan out money. But when consumer spending drops, they loan out less. In a recession there is more risk, so it’s harder to find profitable loans to make. The money does get stuck.