vtsnowedin wrote:I think you are wrong there. When they loan it out for say a car loan it soon comes back into the bank as a deposit from the car dealer. It is 90 % of that deposit that can be reloaned out to somebody else which will also come back to the bank as yet another deposit. So at all times they have deposits equal to 110% of the amount loaned out and reserves of 10 percent (or whatever the law requires today)
Shaved Monkey wrote:The diamonds value is a manufactured monopoly that limits supply to create an illusion of rarity.
It would depend on the level of collapse if you could barter a diamond for a bunch of arugula
MonteQuest wrote:Didn't need to read it.
MQ wrote:To use your terms, "inside" money is the money supply.
A distinction is drawn between outside money, which is either of a fiat nature or backed by some asset that is not in zero net supply within the private sector [gold, silver, etc], and inside money, which is an asset backed by any form of private credit that circulates as a medium of exchange.
MQ wrote:"Outside" money is bank reserves or deposits held on reserve at Federal Reserve banks, and are not part of the money supply.
JV153 wrote:I don't know.. are glitzy trinkets like diamonds paid for with thousands of dollars, or yen, or Euros, etc. also worthless ?
MonteQuest wrote:vtsnowedin wrote:You are not listening !! All money "IS NOT DEBT. Get it? Your premise is false.
I am afraid you are the one who is not listening. All fiat money is loaned into existence as debt.
Google it. You will not find a link to support your position.
Fiat money has been defined variously as:
Any money declared by a government to be legal tender.[5]
State-issued money which is neither convertible by law to any other thing, nor fixed in value in terms of any objective standard.[6]
Intrinsically valueless money used as money because of government decree.[1]
JV153 wrote: The money in bank accounts is loaned out perhaps multiple times.. as the case may be. That's why if a certain number of people come to a bank and withdraw their money.. the bank can't honour all the requests.
MonteQuest wrote:That's how "the people with the printing press run out of money." It becomes worthless.Pops wrote: How could the people with the printing press run out of money?
Pops wrote:MQ wrote:To use your terms, "inside" money is the money supply.
No, it isn't.
Pops wrote:Fiat money is legal tender because the government says it is.
Quinny wrote:I've read your link Pops.
Can't see your definition of outside and inside money?
Not that I understand why it's relevant either
Quinny wrote:I've read your link Pops.
Can't see your definition of outside and inside money?
Not that I understand why it's relevant either
MonteQuest wrote:Pops wrote:Fiat money is legal tender because the government says it is.
Nothing in your link supports your position. Just because it is legal tender is not relevant to the discussion.
This legal tender is loaned into existence. It has debt attached to it. It is debt-based.
A central bank introduces new money into the economy by purchasing financial assets or lending money to financial institutions. Commercial banks then multiply this base money by credit creation through fractional reserve banking, which expands the total supply of broad money
Pops wrote: If I remember my original comment, as the economy cools post peak, the supply of bank deposits will shrink as bank loans are paid or defaulted on, effectively reducing the "money supply."
Pops wrote:MonteQuest wrote:Pops wrote:Fiat money is legal tender because the government says it is.
Nothing in your link supports your position. Just because it is legal tender is not relevant to the discussion.
This legal tender is loaned into existence. It has debt attached to it. It is debt-based.A central bank introduces new money into the economy by purchasing financial assets or lending money to financial institutions. Commercial banks then multiply this base money by credit creation through fractional reserve banking, which expands the total supply of broad money
MonteQuest wrote:Pops wrote:MQ wrote:To use your terms, "inside" money is the money supply.
No, it isn't.
Yes, it is. You disagree with this?
Inside money is created inside the private sector. Inside money includes bank deposits that exist as a result of the loan creation process (money supply). It is the dominant form of money in the modern economy and as the economy has become increasingly electronic it has taken on an increasingly prominent role in the modern economy. Money is no longer a physical thing, a cash note or a gold bar. Its most common form is now numbers in a computer system.
Outside money is money created outside of the private sector. This includes cash notes and bank reserves. This cash form of money primarily serves for convenience purposes that allows one to draw down a bank account of inside money to make transactions in physical currency. The most important form of outside money is bank reserves or deposits held on reserve at Federal Reserve banks.(not part of the money supply)
Pops wrote:Further, since all bank loans have corresponding deposits that offset, if all were zeroed out, your contention is all of today's reserves would disappear somewhere?
Where would they go?
Pops wrote:Where would the vault cash go? counted normally as a part of reserves.
Pops wrote:You keep repeating the bit about all money being debt.
If the dollars in my pocket are debt, who owns them?
Why don't I get a bill in the mail for payment?
Pops wrote:So your contention is M0 is not a part of the money supply?
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