money as debt video google
How an engineer to avoid a recession? Not only debt money?
How an engineer to avoid a recession? Not just money debt? To develop an economy, not only increase the debt? Someone who understands the fractional reserve … What happens when people (generally) borrow money and stop paying interest on outstanding debt? http://video.google.com/videoplay?docid see =… This is my source of confusion and understanding of the banking sector. This question relates to what the media constantly tells us, and the Federal Reserve. May that inflation and slow growth and combat.
First, the link is broken. Secondly, there is an important point that many people miss: When someone pays a debt to a bank, money is destroyed. Deleted. Extinct. Cleared. Every day, in a bank money creates a new and some existing money will be erased. Ponder that. Now, giving an old (debt and the elimination of money) is not necessarily harmful to economic growth. The issuance of a new Bank loan (and the creation of new capital) tends to stimulate economic growth. Take the two together – it could be that the amount of money created is less than the amount of money destroys both money supply net is and the amount of the payment of a debt exceeds the amount of new loans, cut its net debt – but new loans and money that the new economy, stimulate growth. Get it? You do not have a higher debt to GDP increases. In addition, only an increase transactions with the existing supply of money (aka, the velocity of money) can contribute to growth. Three (more …) No, money is obviously not the debt. The fact that money is created in the process of bank loans does not mean that money is debt. It are many people who have no debt and are not creditors but have no money. This is a test, if they really need that money Not debt. If you have a dollar bill in hand, this does not mean that everyone everywhere you owe money, or any other person who owes money. The money is another matter. In addition, not all debt leads to money creation. I could give my old car and we agreement, you owe me $ 1000 for it – no money has been created. Fourthly, if everyone stopped borrowing, then there would a slowdown in consumption and business investment. , Ie, consumers buy fewer things, and businesses spend less money to build facilities or expand operations. As the consumption and investment depends heavily on borrowed money. Without doubt, this causes a recession. (But never applies if you fail to tell the truth that all loans). So people borrow money — participate in economic activities that do not have enough money to do so. Finally, there may or may not be possible to avoid a recession if the economy is on a bicycle. So what? This is not the end of the world – what happens after a few years and the vast majority of people are affected at all.
