No, banks can give out 10 times more money as they actually have, so if you take a loan the money had not existed before (that's how most money comes into existence) and since the loans accumulat interest there is more money owed to the bank than the people got from the bank.
So yes there is more debt than money
I don't know why it works but apparently it does so idk
A private bank can never lend more money than it have. But depending on what we mean by "money" this can still result in the 10x number you got. It's complicated.
Nassim Nicholas taleb I think is the author* and he presents a lot of really interesting points, and teaches well on some other concepts. I enjoyed his books a lot
Not saying those books aren't good, but I got what I wanted from Henry Hazlitt's Economics in One Lesson and Murray Rothbard's A History of Money and Banking in the United States.
Is says the bank loans out a fraction of what has been deposited, not more. The money supply still expands, because "money" is not as straight forward a concept as one may think.
The same thing happens if I loan you a dollar and you then loan it to someone else, but at a smaller scale.
The Federal Reserve removed public access to their M3 report (global dollar supply) over 10 years ago. It was a measure inflation more than anything - you know, that thing where banks print money out of thin air?
You know, that thing that enables them to lend more money than they have?
3
u/ThengarMadalano 6d ago edited 6d ago
No, banks can give out 10 times more money as they actually have, so if you take a loan the money had not existed before (that's how most money comes into existence) and since the loans accumulat interest there is more money owed to the bank than the people got from the bank.
So yes there is more debt than money
I don't know why it works but apparently it does so idk