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Credit Creation and the Money Multiplier - How do Commercial Banks Make Money?

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what a great explanation
Comment from : @mokhinurkholjigitova9201

i started my own bank , doing well using this formula BUT its missing one key point about regulations in place that prevent us from doing certain things that help our customers
Comment from : @RTJ3DCosplay

Are u indianu indian m i right
Comment from : @PritiSingh-tf3fx

There is no fractional reserve banking in a modern sovereign currency regime
Comment from : @jaymills1720

It’s also sustainable if and only if the bank lends the newly created money responsibly Lets say all this new money, created out of thin air, is lent out into the housing market and at the same time the number of houses remains fixed You don’t need a degree in economics to understand what will happen to house prices in this situation In fact you just have to see whats happening to house prices in the world right now
Comment from : @thomasbaker5848

Like if not doing financial markets ?
Comment from : @alphaquehekora9851

Who owns the new 900pounds
Comment from : @ericm3oni

That's a scam
Comment from : @abrarkhan9104

Wonderful 👏 you are great teacher man You've made it very simple 👏
Comment from : @obedbaidoo440

thanks dalllly
Comment from : @dalmapeller2285

in my A Levels rn and you are literally saving my grades
Comment from : @samhitam1875

This man's a savior for me in professional accountancy studies❤❤❤
Comment from : @mumtazwaseem231

Shouldn’t the arrow for “ return” be going from the bank to the saver since the saver will benefit from the interest rates on their savings accounts?
Comment from : @AlevelStudent-c1y

I am really confused with the distinction between money multiplier,credit multiplier,credit creation and money creation someone please help Also credit multiplier is 1/CRR ×100 how? Isn't it LRR
Comment from : @Jaya_Pradhan

I really don't understand how this doesn't cause hyperinflation? Its like just pumping newly printed money into the economy
Comment from : @MCart1215

Fantastic help, Thanks! 👍😁
Comment from : @austinwachira5185

Sorry to correct you, but banks do not create money out of "thin air" Let's look at what is "thin air", what is "thin air"?brWell there infact is no definition of "thin air" Air gets thinner as one goes higher away from the earth, the air is gets thinner asbryou go higher in the atmosphere, therefore banks do not factually "create money out of thin air"
Comment from : @alexdmarcon

makes soo much more sense now! thank you!
Comment from : @Manisha_Magszine

faith based currencies are not ''very sustainable'' they have all died, and GBP will follow in 20-50 years
Comment from : @danielwilson1105

Paper 3 gonna be class
Comment from : @samleboutillier7992

Your videos have been a massive help all throughout my A levels, especially, year 2 when I was really struggling with eco! Thankyou so much❤
Comment from : @aliatharmasood3405

this just blew my mind
Comment from : @nabhanjaffer

Hi! I wanted to find out how a low liquidity ratio would contribute to banks being able to lend more, is the percentage of the deposits that is kept by the bank the liquidity ratio?
Comment from : @aniqarazick7256

Thank you for this ! Gave my A levels exam studying from your channel ! Got an A💕
Comment from : @laibaqasim5872

money isnt really created right its just exchanged hands and theres no accountability
Comment from : @mahfuzahmed971

WELL EXPLAINED SIR
Comment from : @priyalulla1666

Watching this at 1:28am This guy is insane!
Comment from : @parthivchandrak

I am learning so much Thank you for your vids
Comment from : @simplymelay529

whatanexplanation
Comment from : @kevinnimalan9351

you did nail it!
Comment from : @foreverkazi7748

It’s not based on faith; it’s a gamble
Comment from : @JohnOliverY

Yes, you bloody nailed it!
Comment from : @leonardowilhelmdicaprio999

Thank you very much
Comment from : @mameboubakardembatamba1877

If a saver deposits £100 at the bank, and as you say, the bank keeps £10 on their books, while lending out £90, the resultant effect would surely be that no new money is created Rather it is moved around How is this credit creation? There is no explanation for credit creation in this explanation?
Comment from : @matthewlangley9417

thank you so so much I couldn't understand this before you explained it
Comment from : @ridexfreeride8896

Thankyou for this wonderful explanation you create curiosity among your students
Comment from : @thesyangjali3104

Finally I catch up the content here after watching multiple videos It's a very good platform to grasp concepts quickly👍👍👍
Comment from : @bru8672

Are you an indian ?
Comment from : @abhiramvs6471

Thankkkkkk youuu!!!!
Comment from : @farealmalik

🙏🙏🙏
Comment from : @omkakati5227

This guy is too goodthanx
Comment from : @chrisvidsmauchaza8530

Man the only thing I can say lots of love and respect from Afghanistan ,I really enjoy your videos
Comment from : @Stay_Informative

Does this mean the amount of currency notes stays the same but the figures in the account just increases?
Comment from : @deborahkadejo4143

This was explained so clearly that it's almost unbelievable
Comment from : @AAA11546

This man will honestly never know how much he has saved me in my A levels
Comment from : @josephmorgan3881

:D
Comment from : @Meow-pj8do

Richard Werner has empirically refuted the commonly held notion that banks lend money from reservesbr wwwsciencedirectcom/science/article/pii/S1057521914001070
Comment from : @Larimerst

how can the money increased?when its decreasing from 100 to 90
Comment from : @kimkimkim8396

What a bullshit!
Comment from : @LeoTaxilFrance

This is all wrong, an Economist Dream World Go see how it works, banks never loan money Banks write securities contracts (basically IOU's) and enter the amount in a deposit account The Securities Contract is their asset
Comment from : @BRunner12

EcoGod
Comment from : @manishapadia6473

Plizz keep up the good work you really helping out, am grateful
Comment from : @chemzmariano5027

Thanks that explains me what I trying to understand
Comment from : @rammondal4557

Nice
Comment from : @Anoop1236663

Dabba
Comment from : @sanjayr7025

You are a legend :))))
Comment from : @kaiheintsang5656

what if many people fail to repay their debts, how will this effect credit creation?
Comment from : @noonefornow1514

I am a student in kenya and you have been of great help thank you so much
Comment from : @sophiesam7392

he looks like an Indian
Comment from : @RISHABHLakhmani

youre a god and bank runs are scary- what actually happens to the individual if they want to withdraw money during a bank run but the bank doesnt have it? Have they just completely lost their money?
Comment from : @mcjon1013

You are the reason i am doing a degree with a focus on economics At AS level i originally got a D and after finding your videos i ended up with a full UMS A* at A2 There are no words for how grateful i am that i found your channel and subsequently found a subject i love so much! keep up the great work!
Comment from : @superninjarobotgirl