4 comments on “Timmy elsewhere

  1. Perhaps nothing reveals the intellectual bankruptcy of the British Left more than this subject. They simply will not, WILL NOT, look at the facts and will not accept the distinction between creating credit and creating money. I can recall one exchange between Tim Worstall and Ritchie; a dialogue with the deaf. I myself have had fights about it on this blog; nothing moves them!

  2. The distinction, presumably, being that ‘creating credit’ is only ‘creating money’ when the credit obligation requires one to repay in monetary units? Or did you have something else in mind?

    Would anything move *you*? 🙂

  3. They believe an individual bank creates money “out of thin air”; just like that. When it makes a loan, it credits the same amount to the borrower’s account. Nothing else to do, money made.

  4. Not just banks. Any contract or loan between any two parties creates a matching credit and debit. If the credit is specified as a specific amount of some currency that would constitute ‘money’ that had been created.

    And the corresponding debit would be ‘anti-money’. 🙂

    A trade is always of something for something. If you want to trade something now for something later, you can use money as a medium of exchange, to represent the value in the meantime. The money in circulation is simply the total value of all the time-delayed trades currently in progress.

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