MMT macroeconomics primer
Firstly, the money multiplier theory taught by mainstream economics departments is wrong. Learn what that is before you know how its wrong here . The Bank of England have debunked that in their 2014 paper "Money Creation in the Modern Economy" here . Some quotes from the paper: "Bank deposits are simply a record of how much the bank itself owes its customers. So they are a liability of the bank, not an asset that could be lent out. A related misconception is that banks can lend out their reserves. Reserves can only be lent between banks, since consumers do not have access to reserves accounts at the Bank of England." "The reality of how money is created today differs from the description found in some economics textbooks: * Rather than banks receiving deposits when households save and then lending them out, bank lending creates deposits. * In normal times, the central bank does not fix the amount of money in circulation, nor is central bank money ‘multiplie...