McLeay, Michael; Radia, Amar; Thomas, Ryland - In: Bank of England Quarterly Bulletin 54 (2014) 1, pp. 14-27
This article explains how the majority of money in the modern economy is created by commercial banks making loans. Money creation in practice differs from some popular misconceptions — banks do not act simply as intermediaries, lending out deposits that savers place with them, and nor do they...