DiscussWorldIssues - Socio-Economic Religion and Political Uncensored Debate - View Single Post - outstanding interview w/ mike maloney on banking, money and taxes!

**pKgGpUlF** · 10-27-2011, 01:54 AM

It's called fractional reserve lending. As "money" gets spent into circulation via loans having been made, those loans at some point come due. As people with loans start paying back the "money" they'd borrowed in the past, it removes "money" from the pool of "money" we all use.
It gets replenished by new loans being made and that new credit "money" being spent into circulation.
...and then the cycle repeats constantly until the point of debt saturation is reached.

Are you saying you don't understand how our "money" that we all use is created?....and later extinguished?

Sure, I understand how it works. The principal portion of the payment erases that portion of the debt and the interest portion is spent back into the economy where it balances the equation of where the money comes from to pay the debt plus the interest. The interest money always stays in the system along with the remaining unpaid balance of the loan.

10-27-2011, 01:54 AM	#8
pKgGpUlF Join Date Oct 2005 Posts 547 Senior Member	It's called fractional reserve lending. As "money" gets spent into circulation via loans having been made, those loans at some point come due. As people with loans start paying back the "money" they'd borrowed in the past, it removes "money" from the pool of "money" we all use. It gets replenished by new loans being made and that new credit "money" being spent into circulation. ...and then the cycle repeats constantly until the point of debt saturation is reached. Are you saying you don't understand how our "money" that we all use is created?....and later extinguished? Sure, I understand how it works. The principal portion of the payment erases that portion of the debt and the interest portion is spent back into the economy where it balances the equation of where the money comes from to pay the debt plus the interest. The interest money always stays in the system along with the remaining unpaid balance of the loan.
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