Where does the bank get the money to lend to their borrowers?
They use God’s money, or money they create out of nothing, out of “thin air,” from the sky – they have unlimited sources, made possible by stupid, gullible and trusting people like you and me who are led to believe that they are lending us their own money, or money deposited by their clients in their chequing or savings account. The banks really do not have any money or assets to lend. Money is created each time a borrower signs a promissory note which is then deposited into their account as “cash.” Banking regulation does not permit the banks to lend their depositors’ money. This cash value is then used by the bank to increase their book asset by the amount that is equivalent to the loan. It is not as though the bank had this money sitting in their vault waiting for someone to come along and borrow that money. The fact is, prior to the loan agreement, when we come to the bank to borrow money, the money did not exist. Therefore the money had to come from somewhere. In the old days, whe
They use God’s money, or money they create out of nothing, out of “thin air,” from the sky – they have unlimited sources, made possible by stupid, gullible and trusting people like you and me who are led to believe that they are lending us their own money, or money deposited by their clients in their chequing or savings account. The banks really do not have any money or assets to lend. Money is created each time a borrower signs a promissory note which is then deposited into their account as “cash.” Banking regulation does not permit the banks to lend their depositors’ money. This cash value is then used by the bank to increase their book asset by the amount that is equivalent to the loan. It is not as though the bank had this money sitting in their vault waiting for someone to come along and borrow that money. The fact is, prior to the loan agreement, when we come to the bank to borrow money, the money did not exist. Therefore the money had to come from somewhere. In the old days, whe
