That though does not get near the real reason, which is the explanation provided by modern monetary theory. Since banks do not need to hold deposits from customers to make loans, because all loans are made as a result of new money creation, of course banks are not willing to pay people to deposit funds with them anyone. Why on earth would you want to pay for something you no longer need?
That’ll all be most interesting news to actual bankers of course. They’ll be able to fire the entirety of their treasury departments. The savings will last a day perhaps, until the Bank of England comes and closes them down. For of course a bank requires deposits in order to fund its loan book. Something El Twatto simply refuses to acknowledge.
Banks have implicitly or explicitly (it does not really matter which, although some honesty on their part would help, however unlikely it is) rumbled the truth in MMT, which is that bank deposits are economically useless, however much people desire to hold them.
Going this far off piste is amusing. As long as no one ever believes him, when it would become horrifying.
Even by the standards of the recent 30 page plan to save the world and the ‘Tax Transparency principles’ this is Golden stuff…Just batshit…
“As long as no one ever believes him, when it would become horrifying.”
Small g greens are generally far enough away with the fairies to believe it, and big G Greens definitely are.
Good job there’s little chance of the latter getting enough Westminster seats to be dangerous.
It would be fun if an interloper among his coterie of morons managed -in case he’s forgotten the Bank of Belize- to coax out of him the specific banks that are being dishonest.
Good job there’s little chance of the latter getting enough Westminster seats to be dangerous.
Alas they didn’t need to. The lunatics long ago took over the asylum on that front. Just look at the ruination around you…
(ps What is it with the denial of objective reality these days ? This MMT bollox, Trans politics, Covid vaccines, climate change through CO2 the list is endless. When did we sink into this Hegelian philospohical swamp ?)
Otto
When it became fashionable to become green. Or socialist. Or …any of the BS cults.
And folk standing for election follow fashion.
And the faceless morons in the bureaucracy are just people, and so easily become victims of green fashion.
BUT fashion is one thing. How do these idiots continue to believe any of the greenery (etc) actually has the effects desired?
“banks are not willing to pay people to deposit funds with them anyone.”
But . . . banks *do* pay people to deposit funds with them – that is the interest you get on your account. FFS, even my checking account gets interest.
If they didn’t need my deposits they would charge me for banking services, not pay me.
Bank deposits enable the depositor to pay bills that exceed the amount hidden under the mattress. I wonder whether Murphy’s denial of their utility could be linked to his own lack/shortage of bank deposits?
The willingness of banks to pay interest on deposits is a refutation of Murphy’s version of MMT.
In the universe of Spud why would a bank ever want people to save with them? It costs them money in interest payments and worse still a bank can fail if too many people try to withdraw their savings. Yet in the real world, bank’s are steadily increasing their savings rates to encourage more people to invest.
Otto,
I think it really started to kick in with the advent of social media, and especially smart phones.
Prior to this people would read a limited amount of nonsense in the daily paper or watch an evening news bulletin, but the rest of the time would be observing the real world around them and having proper conversations with their family/friends/colleagues.
These days most people I know are absorbed in a constant barrage of ‘news’ which has become a vast woke echo chamber they seem incapable of (or unwilling to) escape by simply switching the bloody thing off for an hour and taking a look around them.
BiK
What is it with the denial of objective reality these days ?
You really have to put it down to the media.
They’ve long gone over to only carrying views that people want to hear. Because that’s what sells media. So it’s a self feeding process. People want to hear what they’ve already heard.
S’pose media’s always been a bit like that. But with the chip wrappers you did have ‘reporters’ with the professional ethics to only report not opinionise. So they were willing to report things people didn’t want to read. Now media sells narratives. They’re targeting feelz. Whether that coincides with objective reality is irrelevant.
One wonders why he hasn’t created his own bank yet. Using his logic you could start a bank with no capital, take no deposits, create money just by making the loan and then sit there and reap the profit – pretty much the definition of money on the table.
Of course reality might interject when the first borrower spends their loan.
If banks can create money by creating loans, why don’t they just created a fucking huge loan to themselves, pack up, go home, and retire in splendor?
Otto,
The war on objectivity started in academia via Derrida, Lyotard, Baudrillard et al
The logical endgame of their work redounds to the “what’s true for you isn’t true for me” logic seen today.
This postmodern view is of course compounded by dreaded multiculturalism.