So I'm trying to formulate my idea of how the economy works and would like others to think about this too.
New money is created via debt - yes or no?
Banks lend out money, often in the form of either a business loan or a mortgage.
So let's say that I get a business loan and I hire 20 people. Those 20 people each get mortgages. Their work pays down my business loan over time, and in return I pay them wages or salaries, which they use to pay down their mortgages over time.
This would...
Read more
New money is created via debt - yes or no?
Banks lend out money, often in the form of either a business loan or a mortgage.
So let's say that I get a business loan and I hire 20 people. Those 20 people each get mortgages. Their work pays down my business loan over time, and in return I pay them wages or salaries, which they use to pay down their mortgages over time.
This would...
Read more
from How does the economy really work?
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