#economics #money
The general rule that "loans create deposits" applies to the government just as much as it does to banks or anybody else.
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Mark Wadsworth: Economic Myths: Governments don't issue currency.created by the credit system and governments borrow deposits that allready exist i.e. the Bond market.
Private sector borrowing comes first in the process creating deposits then the government taxes or borrows those deposits.
Again, nope.
<span>The general rule that "loans create deposits" applies to the government just as much as it does to banks or anybody else.
Borrowing money, taking out a mortgage, printing notes, minting coins, running up credit, issuing currency or signing IOUs, leaving bills unpaid etc. are all shades of the same thing and Summary
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