Did you imagine that banks need an increase in our savings before they can make more loans to businesses? Look at Ann Pettifor's blogpost for 21st Feb 2011 Saving not necessary prior to investment
Ann Pettifor very clearly explains how banks create credit and this should be understood as a fundamental fact of life by everyone. It is not high blown economics to be understood by a few brainy bankers. It is quite a simple concept. Outrageously simple actually. But does everyone who works in financial services understand it? Does every Member of Parliament? Do you as an engineer, nurse, cleaner, railway porter, school teacher, lecturer, botanist, vicar, TV presenter, comedian...?
I think not. If this information was widely understood there would be a huge movement to capture the profits now being taken by banks (witnesss the huge banker's bonuses continuing even in our current crisis). Bankers have such money-making fun. But the profits from creating credit needs to be for the benefit of all of us and not just them. It is outrageous from a fairness point of view to think otherwise. Spread the word.
posted by Charles BazlintonTwitter: @thefreelunch