Posted: Sep 26, 2013 10:08 pm
by GT2211
babel wrote:I think it's normally called a monetary multiplier and is very common in banking ever since the gold standard was abandoned. Since the new bank regulations have come into effect, I think the multiplier has been adjusted so that banks are legally required to hold more cash in reserve than before.
I'm not sure what you suppose can be a solution to the simple fact that there's not enough 'base' around to fund the entire economy?

edit: money multiplier. Dutch doesn't always translate well into English, it seems. http://en.wikipedia.org/wiki/Money_multiplier

There is no money multiplier.