Recently I read some basics about how banks perform money expansion. My knowledge of economics is minimal so I would like to test my understanding of this mechanism on a simple hypothetical example. I ...
Which of these is a better description of money creation: Scenario 1: Central bank creates money Customer A deposits $10 at his bank. Customer B wants to borrow $100. The bank is in good standing ...
Some people believe that inflation is caused by an increase in the money supply when the banks print more notes engage in fractional reserve lending. Is this correct? As I understand it, when there ...
Is all the money created by a central bank destroyed after a period of time ? ie : is all the money in the system debt or is there an amount of money that exist "forever" ?
Wikipedia defines Seigniorage for paper notes and metal coins. Why is seigniorage for paper money not just face value - production cost? I can understand using just the interest rate in the age of the ...
This question is raised in the movie Money as Debt (at time index 29:00). The answer that immediately pops to my head is "because printing money causes inflation". However, according to this movie, ...
There is a lot of talk about the Fed printing money. Is there any way to know how much new money is being printed and when?
A good friend of mine keeps telling me how all money is created from debt, with only a tiny fraction coming from the bank's actual reserves. Which he refers to as "Fractional Reserve Banking". As he ...