Alan Greenspan telling the truth!

[Dovahkiin]

Of course the government can always print more money. The question is who would benefit and who would be harmed.

I don't even think they print most of it. It's just transferred digitally.

You are indeed correct. Banks have these wonderful things called reserves...

Banks have these wonderful things called reserves...

That come from their deposits.

How did the deposits get their in the first place? The majority of money originates from commercial banks "expanding their balance sheets." Clearly, deposits don't fund loans anywhere near in full, if at all, and requirements we have don't exist in other countries based on my knowledge. We do have the capital requirement/reserve requirements/etc..

How did the deposits get their in the first place?

These creatures called customers bring them to the bank, to open savings and checking accounts and to buy CDs.

Clearly, deposits don't fund loans anywhere near in full

Then how else are loans funded?

A bank simply "expands their balance sheets" and creates the deposit.
This isn't hypothetical:
http://www.bankofengland.co.uk/publ...lletin/2014/qb14q1prereleasemoneycreation.pdf

Commercial banks create money, in the form of bank deposits, by making new loans. When a bank makes a loan, for example to someone taking out a mortgage to buy a house, it does not typically do so by giving them thousands of pounds worth of banknotes. Instead, it credits their bank account with a bank deposit of the size of the mortgage. At that moment, new money is created. For this reason, some economists have referred to bank deposits as ‘fountain pen money’, created at the stroke of bankers’ pens when they approve loans.(1)

 

[Dovahkiin]

Of course the government can always print more money. The question is who would benefit and who would be harmed.

I don't even think they print most of it. It's just transferred digitally.

You are indeed correct. Banks have these wonderful things called reserves...

Banks have these wonderful things called reserves...

That come from their deposits.

How did the deposits get their in the first place? The majority of money originates from commercial banks "expanding their balance sheets." Clearly, deposits don't fund loans anywhere near in full, if at all, and requirements we have don't exist in other countries based on my knowledge. We do have the capital requirement/reserve requirements/etc..

How did the deposits get their in the first place?

These creatures called customers bring them to the bank, to open savings and checking accounts and to buy CDs.

Clearly, deposits don't fund loans anywhere near in full

Then how else are loans funded?

Where did the customers money come from? Think about it for a second.

 

[Dale Smith]

I doubt melon head liberals will ever understand that printing money devalues existing money. 5th grade math is over their heads.

Seriously, I have found that trying to educate people on this has been a total waste time.

 

[Toddsterpatriot]

I don't even think they print most of it. It's just transferred digitally.

You are indeed correct. Banks have these wonderful things called reserves...

Banks have these wonderful things called reserves...

That come from their deposits.

Only the central bank can add/subtract from reserves.

Only the central bank can add/subtract from reserves.

And commercial banks get them from their deposits.

Huh? I'm not following you here, the central bank simply uses keystrokes to add/subtract from reserves. Now, we have a policy where banks have to procure a certain amount in reserves in relation to deposits. (I'm pretty sure..)

Huh? I'm not following you here,

Again, I know.

the central bank simply uses keystrokes to add/subtract from reserves.

Yes, central banks create money from thin air. We're not talking about that, we're talking about commercial banks.

 

[Dovahkiin]

You are indeed correct. Banks have these wonderful things called reserves...

Banks have these wonderful things called reserves...

That come from their deposits.

Only the central bank can add/subtract from reserves.

Only the central bank can add/subtract from reserves.

And commercial banks get them from their deposits.

Huh? I'm not following you here, the central bank simply uses keystrokes to add/subtract from reserves. Now, we have a policy where banks have to procure a certain amount in reserves in relation to deposits. (I'm pretty sure..)

Huh? I'm not following you here,

Again, I know.

the central bank simply uses keystrokes to add/subtract from reserves.

Yes, central banks create money from thin air. We're not talking about that, we're talking about commercial banks.

Commercial banks also create money from thin air. It's not hypothetical, the majority of all money originates from bank loans.

 

[Toddsterpatriot]

I don't even think they print most of it. It's just transferred digitally.

You are indeed correct. Banks have these wonderful things called reserves...

Banks have these wonderful things called reserves...

That come from their deposits.

How did the deposits get their in the first place? The majority of money originates from commercial banks "expanding their balance sheets." Clearly, deposits don't fund loans anywhere near in full, if at all, and requirements we have don't exist in other countries based on my knowledge. We do have the capital requirement/reserve requirements/etc..

How did the deposits get their in the first place?

These creatures called customers bring them to the bank, to open savings and checking accounts and to buy CDs.

Clearly, deposits don't fund loans anywhere near in full

Then how else are loans funded?

A bank simply "expands their balance sheets" and creates the deposit.
This isn't hypothetical:
http://www.bankofengland.co.uk/publ...lletin/2014/qb14q1prereleasemoneycreation.pdf

Commercial banks create money, in the form of bank deposits, by making new loans. When a bank makes a loan, for example to someone taking out a mortgage to buy a house, it does not typically do so by giving them thousands of pounds worth of banknotes. Instead, it credits their bank account with a bank deposit of the size of the mortgage. At that moment, new money is created. For this reason, some economists have referred to bank deposits as ‘fountain pen money’, created at the stroke of bankers’ pens when they approve loans.(1)

A bank simply "expands their balance sheets" and creates the deposit.

We were talking about reserves. Banks get them when customers make deposits.
These deposits that are created by a bank don't seem to change reserves.

Instead, it credits their bank account with a bank deposit of the size of the mortgage. At that moment, new money is created.

I hope the home buyer doesn't try to write a check from that account....unless the bank has reserves from other deposits. Poor guy would bounce the check. The seller might get angry.

 

[Toddsterpatriot]

I doubt melon head liberals will ever understand that printing money devalues existing money. 5th grade math is over their heads.

Seriously, I have found that trying to educate people on this has been a total waste time.

Because you're an idiot.

 

[Toddsterpatriot]

I don't even think they print most of it. It's just transferred digitally.

You are indeed correct. Banks have these wonderful things called reserves...

Banks have these wonderful things called reserves...

That come from their deposits.

How did the deposits get their in the first place? The majority of money originates from commercial banks "expanding their balance sheets." Clearly, deposits don't fund loans anywhere near in full, if at all, and requirements we have don't exist in other countries based on my knowledge. We do have the capital requirement/reserve requirements/etc..

How did the deposits get their in the first place?

These creatures called customers bring them to the bank, to open savings and checking accounts and to buy CDs.

Clearly, deposits don't fund loans anywhere near in full

Then how else are loans funded?

Where did the customers money come from? Think about it for a second.

Where did the customers money come from? Think about it for a second.

Mine comes from salary, dividends, stock sales. I could probably come up with more.

 

[Dovahkiin]

You are indeed correct. Banks have these wonderful things called reserves...

Banks have these wonderful things called reserves...

That come from their deposits.

How did the deposits get their in the first place? The majority of money originates from commercial banks "expanding their balance sheets." Clearly, deposits don't fund loans anywhere near in full, if at all, and requirements we have don't exist in other countries based on my knowledge. We do have the capital requirement/reserve requirements/etc..

How did the deposits get their in the first place?

These creatures called customers bring them to the bank, to open savings and checking accounts and to buy CDs.

Clearly, deposits don't fund loans anywhere near in full

Then how else are loans funded?

Where did the customers money come from? Think about it for a second.

Where did the customers money come from? Think about it for a second.

Mine comes from salary, dividends, stock sales. I could probably come up with more.

Again, go past that. Government deficit spending or commercial bank loans, which both create money.

 

[Dovahkiin]

You are indeed correct. Banks have these wonderful things called reserves...

Banks have these wonderful things called reserves...

That come from their deposits.

How did the deposits get their in the first place? The majority of money originates from commercial banks "expanding their balance sheets." Clearly, deposits don't fund loans anywhere near in full, if at all, and requirements we have don't exist in other countries based on my knowledge. We do have the capital requirement/reserve requirements/etc..

How did the deposits get their in the first place?

These creatures called customers bring them to the bank, to open savings and checking accounts and to buy CDs.

Clearly, deposits don't fund loans anywhere near in full

Then how else are loans funded?

A bank simply "expands their balance sheets" and creates the deposit.
This isn't hypothetical:
http://www.bankofengland.co.uk/publ...lletin/2014/qb14q1prereleasemoneycreation.pdf

Commercial banks create money, in the form of bank deposits, by making new loans. When a bank makes a loan, for example to someone taking out a mortgage to buy a house, it does not typically do so by giving them thousands of pounds worth of banknotes. Instead, it credits their bank account with a bank deposit of the size of the mortgage. At that moment, new money is created. For this reason, some economists have referred to bank deposits as ‘fountain pen money’, created at the stroke of bankers’ pens when they approve loans.(1)

A bank simply "expands their balance sheets" and creates the deposit.

We were talking about reserves. Banks get them when customers make deposits.
These deposits that are created by a bank don't seem to change reserves.

Instead, it credits their bank account with a bank deposit of the size of the mortgage. At that moment, new money is created.

I hope the home buyer doesn't try to write a check from that account....unless the bank has reserves from other deposits. Poor guy would bounce the check. The seller might get angry.

Huh? I was pretty sure we shifted to talking about deposits. I'm tired and a little messed up though, so I may have missed something.
Todd, the fed always makes sure banks have adequate reserves, and it's extremely cheap to get reserves right now in the overnight.

 

[Dale Smith]

Banks have these wonderful things called reserves...

That come from their deposits.

Only the central bank can add/subtract from reserves.

Only the central bank can add/subtract from reserves.

And commercial banks get them from their deposits.

Huh? I'm not following you here, the central bank simply uses keystrokes to add/subtract from reserves. Now, we have a policy where banks have to procure a certain amount in reserves in relation to deposits. (I'm pretty sure..)

Huh? I'm not following you here,

Again, I know.

the central bank simply uses keystrokes to add/subtract from reserves.

Yes, central banks create money from thin air. We're not talking about that, we're talking about commercial banks.

Commercial banks also create money from thin air. It's not hypothetical, the majority of all money originates from bank loans.

But they want to be paid back with HARD currency plus interest.... and like a home loan that will take in three times of what they loaned out from nothing because the interest is loaded on the front end and you don't start paying down on the principal until well into the loan.......don't you see a problem with that? Your signature on the Promissory note was the same as the Fed printing money and this all goes back to the Chapter 11 Bankruptcy Act of 1933 where our signature was as good as money.

 

[Toddsterpatriot]

Banks have these wonderful things called reserves...

That come from their deposits.

Only the central bank can add/subtract from reserves.

Only the central bank can add/subtract from reserves.

And commercial banks get them from their deposits.

Huh? I'm not following you here, the central bank simply uses keystrokes to add/subtract from reserves. Now, we have a policy where banks have to procure a certain amount in reserves in relation to deposits. (I'm pretty sure..)

Huh? I'm not following you here,

Again, I know.

the central bank simply uses keystrokes to add/subtract from reserves.

Yes, central banks create money from thin air. We're not talking about that, we're talking about commercial banks.

Commercial banks also create money from thin air. It's not hypothetical, the majority of all money originates from bank loans.

the majority of all money originates from bank loans.

Absolutely.

Commercial banks also create money from thin air.

Only if your definition of "thin air" is "customer deposits"

 

[Toddsterpatriot]

Banks have these wonderful things called reserves...

That come from their deposits.

How did the deposits get their in the first place? The majority of money originates from commercial banks "expanding their balance sheets." Clearly, deposits don't fund loans anywhere near in full, if at all, and requirements we have don't exist in other countries based on my knowledge. We do have the capital requirement/reserve requirements/etc..

How did the deposits get their in the first place?

These creatures called customers bring them to the bank, to open savings and checking accounts and to buy CDs.

Clearly, deposits don't fund loans anywhere near in full

Then how else are loans funded?

Where did the customers money come from? Think about it for a second.

Where did the customers money come from? Think about it for a second.

Mine comes from salary, dividends, stock sales. I could probably come up with more.

Again, go past that. Government deficit spending or commercial bank loans, which both create money.

Okay. So what?

 

[Dovahkiin]

Only the central bank can add/subtract from reserves.

Only the central bank can add/subtract from reserves.

And commercial banks get them from their deposits.

Huh? I'm not following you here, the central bank simply uses keystrokes to add/subtract from reserves. Now, we have a policy where banks have to procure a certain amount in reserves in relation to deposits. (I'm pretty sure..)

Huh? I'm not following you here,

Again, I know.

the central bank simply uses keystrokes to add/subtract from reserves.

Yes, central banks create money from thin air. We're not talking about that, we're talking about commercial banks.

Commercial banks also create money from thin air. It's not hypothetical, the majority of all money originates from bank loans.

the majority of all money originates from bank loans.

Absolutely.

Commercial banks also create money from thin air.

Only if your definition of "thin air" is "customer deposits"

Todd, I don't think you're seeing my point.
You and me know the majority of money comes from bank loans. You know, the money we decide to bring to banks to open our deposits, the money employers give to their employees.. Let's assume that banks use customer deposits as a source.. How?? Are we talking about the money multiplier?

 

[Toddsterpatriot]

Banks have these wonderful things called reserves...

That come from their deposits.

How did the deposits get their in the first place? The majority of money originates from commercial banks "expanding their balance sheets." Clearly, deposits don't fund loans anywhere near in full, if at all, and requirements we have don't exist in other countries based on my knowledge. We do have the capital requirement/reserve requirements/etc..

How did the deposits get their in the first place?

These creatures called customers bring them to the bank, to open savings and checking accounts and to buy CDs.

Clearly, deposits don't fund loans anywhere near in full

Then how else are loans funded?

A bank simply "expands their balance sheets" and creates the deposit.
This isn't hypothetical:
http://www.bankofengland.co.uk/publ...lletin/2014/qb14q1prereleasemoneycreation.pdf

Commercial banks create money, in the form of bank deposits, by making new loans. When a bank makes a loan, for example to someone taking out a mortgage to buy a house, it does not typically do so by giving them thousands of pounds worth of banknotes. Instead, it credits their bank account with a bank deposit of the size of the mortgage. At that moment, new money is created. For this reason, some economists have referred to bank deposits as ‘fountain pen money’, created at the stroke of bankers’ pens when they approve loans.(1)

A bank simply "expands their balance sheets" and creates the deposit.

We were talking about reserves. Banks get them when customers make deposits.
These deposits that are created by a bank don't seem to change reserves.

Instead, it credits their bank account with a bank deposit of the size of the mortgage. At that moment, new money is created.

I hope the home buyer doesn't try to write a check from that account....unless the bank has reserves from other deposits. Poor guy would bounce the check. The seller might get angry.

Huh? I was pretty sure we shifted to talking about deposits. I'm tired and a little messed up though, so I may have missed something.
Todd, the fed always makes sure banks have adequate reserves, and it's extremely cheap to get reserves right now in the overnight.

Todd, the fed always makes sure banks have adequate reserves

How much have banks borrowed from the Fed in the last 5 years?

 

[Dovahkiin]

How did the deposits get their in the first place? The majority of money originates from commercial banks "expanding their balance sheets." Clearly, deposits don't fund loans anywhere near in full, if at all, and requirements we have don't exist in other countries based on my knowledge. We do have the capital requirement/reserve requirements/etc..

How did the deposits get their in the first place?

These creatures called customers bring them to the bank, to open savings and checking accounts and to buy CDs.

Clearly, deposits don't fund loans anywhere near in full

Then how else are loans funded?

A bank simply "expands their balance sheets" and creates the deposit.
This isn't hypothetical:
http://www.bankofengland.co.uk/publ...lletin/2014/qb14q1prereleasemoneycreation.pdf

Commercial banks create money, in the form of bank deposits, by making new loans. When a bank makes a loan, for example to someone taking out a mortgage to buy a house, it does not typically do so by giving them thousands of pounds worth of banknotes. Instead, it credits their bank account with a bank deposit of the size of the mortgage. At that moment, new money is created. For this reason, some economists have referred to bank deposits as ‘fountain pen money’, created at the stroke of bankers’ pens when they approve loans.(1)

A bank simply "expands their balance sheets" and creates the deposit.

We were talking about reserves. Banks get them when customers make deposits.
These deposits that are created by a bank don't seem to change reserves.

Instead, it credits their bank account with a bank deposit of the size of the mortgage. At that moment, new money is created.

I hope the home buyer doesn't try to write a check from that account....unless the bank has reserves from other deposits. Poor guy would bounce the check. The seller might get angry.

Huh? I was pretty sure we shifted to talking about deposits. I'm tired and a little messed up though, so I may have missed something.
Todd, the fed always makes sure banks have adequate reserves, and it's extremely cheap to get reserves right now in the overnight.

Todd, the fed always makes sure banks have adequate reserves

How much have banks borrowed from the Fed in the last 5 years?

You know the answer already. QE ring a bell? Ever hear Bernie bitch about bank bailouts?

 

[Dovahkiin]

How did the deposits get their in the first place? The majority of money originates from commercial banks "expanding their balance sheets." Clearly, deposits don't fund loans anywhere near in full, if at all, and requirements we have don't exist in other countries based on my knowledge. We do have the capital requirement/reserve requirements/etc..

How did the deposits get their in the first place?

These creatures called customers bring them to the bank, to open savings and checking accounts and to buy CDs.

Clearly, deposits don't fund loans anywhere near in full

Then how else are loans funded?

Where did the customers money come from? Think about it for a second.

Where did the customers money come from? Think about it for a second.

Mine comes from salary, dividends, stock sales. I could probably come up with more.

Again, go past that. Government deficit spending or commercial bank loans, which both create money.

Okay. So what?

Money comes from, the majority, bank loans. In regards to your examples, the majority of money paid to you came from bank loans! There's simply no way in which customer deposits create the loans. I just can't see it.

 

[Toddsterpatriot]

Only the central bank can add/subtract from reserves.

And commercial banks get them from their deposits.

Huh? I'm not following you here, the central bank simply uses keystrokes to add/subtract from reserves. Now, we have a policy where banks have to procure a certain amount in reserves in relation to deposits. (I'm pretty sure..)

Huh? I'm not following you here,

Again, I know.

the central bank simply uses keystrokes to add/subtract from reserves.

Yes, central banks create money from thin air. We're not talking about that, we're talking about commercial banks.

Commercial banks also create money from thin air. It's not hypothetical, the majority of all money originates from bank loans.

the majority of all money originates from bank loans.

Absolutely.

Commercial banks also create money from thin air.

Only if your definition of "thin air" is "customer deposits"

Todd, I don't think you're seeing my point.
You and me know the majority of money comes from bank loans. You know, the money we decide to bring to banks to open our deposits, the money employers give to their employees.. Let's assume that banks use customer deposits as a source.. How?? Are we talking about the money multiplier?

You and me know the majority of money comes from bank loans.

Yup.

Let's assume that banks use customer deposits as a source.. How??

I bring a $1000 deposit. Based on a 10% reserve requirement, the bank can lend $900.
The next bank gets the $900 deposit and can lend $810.
The third bank gets the $810 deposit and can lend $729.
Each bank gets a deposit and uses it to make a new loan.
Each loan is fully funded, nothing created from thin air. Every check clears.

Now you show your scenario where the same events occur.....with no customer deposits.

 

[Toddsterpatriot]

How did the deposits get their in the first place?

These creatures called customers bring them to the bank, to open savings and checking accounts and to buy CDs.

Clearly, deposits don't fund loans anywhere near in full

Then how else are loans funded?

A bank simply "expands their balance sheets" and creates the deposit.
This isn't hypothetical:
http://www.bankofengland.co.uk/publ...lletin/2014/qb14q1prereleasemoneycreation.pdf

Commercial banks create money, in the form of bank deposits, by making new loans. When a bank makes a loan, for example to someone taking out a mortgage to buy a house, it does not typically do so by giving them thousands of pounds worth of banknotes. Instead, it credits their bank account with a bank deposit of the size of the mortgage. At that moment, new money is created. For this reason, some economists have referred to bank deposits as ‘fountain pen money’, created at the stroke of bankers’ pens when they approve loans.(1)

A bank simply "expands their balance sheets" and creates the deposit.

We were talking about reserves. Banks get them when customers make deposits.
These deposits that are created by a bank don't seem to change reserves.

Instead, it credits their bank account with a bank deposit of the size of the mortgage. At that moment, new money is created.

I hope the home buyer doesn't try to write a check from that account....unless the bank has reserves from other deposits. Poor guy would bounce the check. The seller might get angry.

Huh? I was pretty sure we shifted to talking about deposits. I'm tired and a little messed up though, so I may have missed something.
Todd, the fed always makes sure banks have adequate reserves, and it's extremely cheap to get reserves right now in the overnight.

Todd, the fed always makes sure banks have adequate reserves

How much have banks borrowed from the Fed in the last 5 years?

You know the answer already. QE ring a bell? Ever hear Bernie bitch about bank bailouts?

QE involved banks borrowing from the Fed?

 

[Dovahkiin]

A bank simply "expands their balance sheets" and creates the deposit.
This isn't hypothetical:
http://www.bankofengland.co.uk/publ...lletin/2014/qb14q1prereleasemoneycreation.pdf

A bank simply "expands their balance sheets" and creates the deposit.

We were talking about reserves. Banks get them when customers make deposits.
These deposits that are created by a bank don't seem to change reserves.

Instead, it credits their bank account with a bank deposit of the size of the mortgage. At that moment, new money is created.

I hope the home buyer doesn't try to write a check from that account....unless the bank has reserves from other deposits. Poor guy would bounce the check. The seller might get angry.

Huh? I was pretty sure we shifted to talking about deposits. I'm tired and a little messed up though, so I may have missed something.
Todd, the fed always makes sure banks have adequate reserves, and it's extremely cheap to get reserves right now in the overnight.

Todd, the fed always makes sure banks have adequate reserves

How much have banks borrowed from the Fed in the last 5 years?

You know the answer already. QE ring a bell? Ever hear Bernie bitch about bank bailouts?

QE involved banks borrowing from the Fed?

Of course not.