Posted: Mar 30, 2013 1:16 am
No worries. Regular banks can't create new money. Only the central banks can, as far as I know. I don't know about the various accounts. I only know broad details, not the specifics.
You've asked a couple of times about why bother with depositors if they can just get the money off the central banks, I assume that it's part of the rules regarding fractional reserve lending. That is, you must have x% reserves of depositor money before you can loan the rest out. Hence why they pay interest of say 5%, but they charge interest of say 8%+ on loans.
You've asked a couple of times about why bother with depositors if they can just get the money off the central banks, I assume that it's part of the rules regarding fractional reserve lending. That is, you must have x% reserves of depositor money before you can loan the rest out. Hence why they pay interest of say 5%, but they charge interest of say 8%+ on loans.