Re: Another 'I dont understand the banking system' Thread : Sat Nov 26, 2011 8:07 am  

LeighGionaire wrote:

Well people are in complete denial about how money is created, as Galbraith said -

If banks create money how do they run out of it?

Re: Another 'I dont understand the banking system' Thread : Sat Nov 26, 2011 9:26 am  

SBR wrote: If banks create money how do they run out of it? Two reasons - 1) Reserve requirement - there is supposedly a ceiling on how much money they can create depending upon the amount of deposit money they have. 2) They need a borrower's signature to create the money. Here's a letter from the Bank Of England where they confirm that banks create NEW money when making loans - http://www.onegoodcut.org/wp-content/up ... eation.jpg

SBR wrote: If banks create money how do they run out of it? Two reasons - 1) Reserve requirement - there is supposedly a ceiling on how much money they can create depending upon the amount of deposit money they have. 2) They need a borrower's signature to create the money. Here's a letter from the Bank Of England where they confirm that banks create NEW money when making loans - http://www.onegoodcut.org/wp-content/up ... eation.jpg

Re: Another 'I dont understand the banking system' Thread : Sat Nov 26, 2011 1:18 pm  

LeighGionaire wrote:

Two reasons -

1) Reserve requirement - there is supposedly a ceiling on how much money they can create depending upon the amount of deposit money they have.

2) They need a borrower's signature to create the money.

No, it's because they have to front up the money 'cos they can't create it. Banks create liquidity not money. Part of the problems at the moment steam not from a lack of money in the economy (there's actually more money as governments, who can create money, have created it) but a lack of liquidity from banks not lending.

Re: Another 'I dont understand the banking system' Thread : Sat Nov 26, 2011 4:56 pm  

handrags wrote: if that where true wouldnt house prices be at rock bottom ? and if you do default on your morgage the bank would own your house [ still a valuble asset], Yet the yanks owe trillions, and yanks rent property as do most europeans so thats not the simple answer. Look at property prices in Detroit if you don't think they are rock bottom. In this country all BoE and government policy is aimed at keeping property prices artificially high. Eg http://www.homes.com/Real_Estate/MI/City/DETROIT/

handrags wrote: if that where true wouldnt house prices be at rock bottom ? and if you do default on your morgage the bank would own your house [ still a valuble asset], Yet the yanks owe trillions, and yanks rent property as do most europeans so thats not the simple answer. Look at property prices in Detroit if you don't think they are rock bottom. In this country all BoE and government policy is aimed at keeping property prices artificially high. Eg http://www.homes.com/Real_Estate/MI/City/DETROIT/

Re: Another 'I dont understand the banking system' Thread : Sat Nov 26, 2011 5:21 pm  

Dally wrote:

Look at property prices in Detroit

Nice pick.

Have you ever been to Detroit?

Re: Another 'I dont understand the banking system' Thread : Tue Dec 13, 2011 7:42 pm  

SBR wrote: LeighGionaire wrote: Two reasons - 1) Reserve requirement - there is supposedly a ceiling on how much money they can create depending upon the amount of deposit money they have. 2) They need a borrower's signature to create the money. No, it's because they have to front up the money 'cos they can't create it. Banks create liquidity not money. Part of the problems at the moment steam not from a lack of money in the economy (there's actually more money as governments, who can create money, have created it) but a lack of liquidity from banks not lending. I've shown you many examples of people stating that banks do indeed create money yet you still refuse to accept it as fact, why is that? What makes you dismiss official bank literature and economists comments that explain that banks can and do inflate the money supply? Here's another one, Detlev Schlichter an 'Economist who has worked in finance for 20 years including stints at Meryll Lynch and J.P Morgan', talking on The Kaiser Report 13.25 minutes in - http://www.youtube.com/watch?v=C8FIXhDJ8o0

SBR wrote: LeighGionaire wrote: Two reasons - 1) Reserve requirement - there is supposedly a ceiling on how much money they can create depending upon the amount of deposit money they have. 2) They need a borrower's signature to create the money. No, it's because they have to front up the money 'cos they can't create it. Banks create liquidity not money. Part of the problems at the moment steam not from a lack of money in the economy (there's actually more money as governments, who can create money, have created it) but a lack of liquidity from banks not lending. I've shown you many examples of people stating that banks do indeed create money yet you still refuse to accept it as fact, why is that? What makes you dismiss official bank literature and economists comments that explain that banks can and do inflate the money supply? Here's another one, Detlev Schlichter an 'Economist who has worked in finance for 20 years including stints at Meryll Lynch and J.P Morgan', talking on The Kaiser Report 13.25 minutes in - http://www.youtube.com/watch?v=C8FIXhDJ8o0

Re: Another 'I dont understand the banking system' Thread : Tue Dec 13, 2011 7:46 pm  

The debt based money system is the prime reason that the gap between the rich and poor consistantly grows wider and wider as explained in this video - http://www.youtube.com/watch?v=hx16a72j__8

The debt based money system is the prime reason that the gap between the rich and poor consistantly grows wider and wider as explained in this video - http://www.youtube.com/watch?v=hx16a72j__8