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Pittsburg, Kansas | But you get paid for those crops out of existing money supply. And someone had to take a loan out for that money to have ever existed. With the exception of the money that is created by the Fed (a small percentage), nearly all of what we call "money" is actually checkbook money created by commercial banks when they loannew money into existance. I have seen different numbers (and even the Fed is unsure how much paper currency resides in the US because a lot ends up in other countries) but somewhere on the order of 96% is checking account money that did not exist till someone took out a loan.
Totally friggin unbelievable, ain't it.
Once you grasp that reality, the mess we are in (at least the banking/financial mess) starts coming into focus. It is a classic Ponzi monetary system, albeit a long lived one before debt begating debt goes exponential.
John | |
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why banks needd deposits
