Where does the money come from?Eric | July 3, 2008
This is an interesting piece of video I find:
The banks don’t create money. The central bank (i.e., the Federal Reserve Bank in the US) creates the money. They do that through issuing treasury bills and they make that money available to banks to lend. Treasure bills are nothing more than the government borrowing money and agreeing to pay it later at a specific interest rate.
[read the complete statement]