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Dear Monetary Reform members,
Bill Ryan in responding to Dan
Parker is continuing to confuse two issues. The first is that the
banks create money out of nothing. That is agreed. And I have
previously pointed out the massive public ignorance about the
matter.
The second is whether the bank's
ability to make loans is unlimited -- and I do not remember Dan saying that it
was unlimited.
Furthermore, suppose there
is miniscule limitation on banks making loans (as there undoubtedly is)
how can that detract from the main issue -- that the banks create the
money out of nothing? It cannot.
And if there is substantial
limitation (e.g. an inability to fund credit-worthy borrowers) that, too, does
not detract from the fact that the banks create the money out of nothing.
The creation happens because the
individual banks receiving deposits can on-lend and that lending can end up as
deposits elsewhere which can in turn be on-lent. It would be
nice if there were to be no further obfuscation of this
matter.
Rodney Shakespeare.
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