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There is a difference - the money that’s stored in the bank is not just sitting there. It is lent out with an interest to people who need to borrow money and e
by psadri 7y ago
There is a difference - the money that’s stored in the bank is not just sitting there. It is lent out with an interest to people who need to borrow money and earns the bank an income. The banks want your deposits because it lets them earn money. To compete with one another they offer interest bearing deposit accounts.
- 345218435 7y agothat‘s a nice theory. what actually happens is, when you borrow money, they put the numbers into your account and the negative on their balance sheet. that‘s the basic process of money-creation in a fiat system. out of thin air. debt-based on top so that nobody ever gets away. but yeah, everybody likes to believe that the amount of money in the system represents goods and services.