The only improvement I’d suggest is that ‘the politician’ fails to point out that the private banks create new money whenever they lend – yet somehow this goes unmentioned so the implication seems to be that this never creates any inflation. Hence, when the government creates new money we are always going to end up like Zimbabwe or Venezuela but never, ever when the private banks do it.
We do tend to mention it quite a lot actually. The bank creation of credit – note, not money – being the thing we influence, temper or encourage, by changing interest rates.
The Senior Lecturer has noted that we do in fact change interest rates in order to change credit creation, has he?