How Banks Create Money Out Of Thin Air
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@decayingclown when the FED was created in 1913.
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In what year did this bank problem start with the whole making of money out of thin air?
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Is this why bank of america is at a little over $5 a share???
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...good1, kalinda
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Nope, they actually just type 90,000 dollars of new money into existence and give the check to the borrower on the promise that it'll be payed back. Meanwhile the 90,000 dollars that was deposited before still stays in the bank, it doesn't go to the borrower.
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@NewWorldOrderElite there is no capitalism in america, for there is a monopoly on money and security and what not
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Also, those "created money" are just paper assets, not REAL assets, until they cash it in, which sometimes other people don't pay and banks just lost lots of money.
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There's a huge misunderstanding... The banks seem to create $90,000 out of thin air but remember they still "owe" $100,000 to the one who deposited the money in the first place, it just can't be withdraw yet.
When the $90,000 goes to the borrower he uses it up, so the bank really risked $90,000 and they are $90,000 less in money, but they hope to make money off of interest.
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Simple...Excellent
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Corection to my alinia makes it more understanding in mind : but only the loan and interest of this loan - they have got back - is a new subject to create new loans ... so not a 90.000 to 81.000 to 72.900 ...
In Soviet Russia you rob bank, in Capitalist America bank robs you!
NewWorldOrderElite 8 months ago 14
love to shag her until to she gives birth to $1billion bill.
:D
abdi3810 1 year ago 3