Yes, the government prints our paper money. But that’s only a small fraction of themoney in use. Most of the money in national economies iscreated when banks write it into their customers’ accounts out of thin air as bank loans.
You earn $100 and put it in the bank. And then…
The bank keeps $10 in its Federal Reserve account …
Thisis the “reserve,” which the bank uses when customers withdraw funds. As a rule, depositors don’t take out more than 10% of the money they have on deposit on any given day.
Then loans Susie $90, at interest.
Susie deposits the $90 in her bank.
That bank keeps 10% ($9) in reserve and loans Joe $81, at interest.
See how it all adds up—for the banks.
You now have $100 in your account. Susie has $90 in hers. Joe has $81.
There’s now $271 total in accounts that you and Susie and Joe can spend, and it all came from your $100 deposit. The banks have created an additional $171 by loaning it into existence.
Imagine thismoney trick over and over.
If you do this operation 50 times, that $100 turns into $995.25—$885.25 in loans, and your original $100.
Mad math: If those loans are for one year at 10% interest, the banks will make $88.53. If they’d only been able to loan your $100, they’d make $10.
At times you come across situations when you have to write letters. These letters can be both formal as well as informal. There is also a possibility that you have to write a semi -formal letter. All these letters have their own fixed rules and format to be followed. Read more
For the last few decades, educational process has become more technological and automated. When information technologies have become a significant part of every sphere of people’s activity, no one can deal without knowledge in modern tools needed for projects and ideas’ presentation, advancement, promotion, etc. Read more
So, you’ve heard of probiotics, right – those supplements you take that contain nutrients to improve your gut flora? That’s right; those things people take when they’reon a health kick. The sort of people who are determined to be as healthy as possible. Those people, right? Read more