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> high saving-low investment environment How can such an environment be so stable? If people put their savings into a bank account, then this savings would nev
by Archelaos 5y ago
> high saving-low investment environment
How can such an environment be so stable? If people put their savings into a bank account, then this savings would nevertheless be available for investments via the banks, arn't they?
- DasIch 5y ago> If people put their savings into a bank account, then this savings would nevertheless be available for investments via the banks, arn't they? No, those two things have nothing to do with each other. When you ask a bank for credit to invest into something, the bank just creates money they don't take money from other customers.
- tenuousemphasis 5y agoThe amount of deposits puts an upper bound on the amount of loans due to the 10% reserve requirement, but otherwise yes.