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Obviously, not all transfers of money are loans, like your dividend payments, or normal transactional commerce. The statement is that when a bank creates a loan
by reso 3y ago
Obviously, not all transfers of money are loans, like your dividend payments, or normal transactional commerce. The statement is that when a bank creates a loan, it creates money. The money they give to the lendee is new money. This is the primary mechanism of money creation in our system.