va1234 Wrote:
Nov 14, 2012 11:06 PM
Americans your money comes from two sources. One is the government through the issuance of treasury bills to finance the debt of the US government. The second is from the banks by making loans based on less money (called reserves) than they have in their vaults. If a bank has 1000$ in deposits it can make loans of 10,000$, which creates $9000 dollars that never existed before. Important to note is that the bank creates that $9000 at interest, say 5%. So the bank creates $9000 plus 5% all in new money. What we have in the USA is a conflict over who gets to create money. This conflict is the entire basis of the current “debt crisis” in the US. The very rich people who have cornered the market on dollars as in who have benefitted...