"YouTube" канал "Money & Macro"

Dutch vs. USA Economic Model: the Complete Middle Class Experience (feat. Econoboi)

A comparison of wages, cost-of-living, social safety nets, labor markets, quality of life, family life, education systems, upward mobility, and the pension system.

WANT TO HELP ME PRODUCE MORE CONTENT LIKE THIS?
△ Liked the in-depth research and want to help me do more? Consider buying me a coffee at https://ko-fi.com/moneymacro or for the Dutchies https://betaalverzoek.knab.nl/nKVpLSbrCMDCRyH.
△ For some extra benefits consider supporting me longer term on: https://www.patreon.com/moneymacro
△ Finally, for other one-time donations: https://www.paypal.com/donate?hosted_button_id=9JRG5URQ9KEHS

WANT TO SEE MORE CONTENT LIKE THIS?
△ Check out Econoboi's channel here: https://www.youtube.com/channel/UCfA54o0hJc1n7SfxYNSCafA
△ Interested in other country economic case studies? https://www.youtube.com/playlist?list=PLGbVoSdwvesDNHLHmkZzvW2vuCfllJhpA
△ Want to know about central banking? https://www.youtube.com/playlist?list=PLGbVoSdwvesCIGv-sN7OiQLryj2f4bAGE
△ Interested in bubbles and asset markets? https://www.youtube.com/playlist?list=PLGbVoSdwvesD_W5OHSJ6J_j-RKeCxl0OS

Narrated and produced by Dr. Joeri Schasfoort (University of Cape Town & University of Groningen)
https://twitter.com/joerischasfoort
https://www.linkedin.com/in/joeri-schasfoort/

Script and Sources:
Check out the sources in detail on my blog (will update tomorrow):

https://www.moneymacro.rocks/blog/

RELATED VIDEOS AND VIDEOS I REFER TO IN THE VIDEO
- Here is the awesome video by @Not Just Bikes about using cars or renting one and how it interacts with city design: https://youtu.be/OObwqreAJ48
- I used this video from @Second Thought for information on how full-time working affects benefit payments in the United States: https://youtu.be/yhBkeAo2Hlg
- Finally, to get a feel for the American system and its critics I watched a lot of @Breaking Points , @Secular Talk , @David Pakman Show and @Destiny .

Timestamps:
0:00 - introduction
3:16 - wages & cost-of-living
13:31 - social safety net
21:50 - labor market conditions
30:46 - quality of life
37:42 - family life
42:20 - education systems
49:35 - upward mobility
55:48 - pension systems
1:01:52 - final discussion

Attribution:
Standard Icons "Designed by rawpixel.com / Freepik"
Elderly and Oil industry Icons "Designed by macrovector / Freepik"
medicaid animation: Creative commons the Actors Fund (youtube channel)
rating icons: "Designed by starline / Freepik"
Finally, I used video clips from US news and tv shows under the 'fair use' clause.….

Dutch vs. USA Economic Model: the Complete Middle Class Experience (feat. Econoboi)

A comparison of wages, cost-of-living, social safety nets, labor [...]

REALLY!? The Dutch Economy is the Most Unequal? - a Response to Economics Explained

As a Dutch economist who works for a South African University, I was [...]

As a Dutch economist who works for a South African University, I was absolutely shocked when I saw this video from Economics Explained (EE) which states that the economy of the Netherlands is in fact the most unequal on earth!!

WANT TO HELP ME PRODUCE MORE CONTENT LIKE THIS?
△ Liked the in-depth research and want to help me do more? Consider buying me a coffee at https://ko-fi.com/moneymacro or for the Dutchies https://betaalverzoek.knab.nl/nKVpLSbrCMDCRyH.
△ For some extra benefits consider supporting me longer term on: https://www.patreon.com/moneymacro
△ Finally, for other one-time donations: https://www.paypal.com/donate?hosted_button_id=9JRG5URQ9KEHS

△ Link to EE's video: https://youtu.be/Ot4qdCs54ZE
△ Check out my economic country studies here: https://www.youtube.com/playlist?list=PLGbVoSdwvesDNHLHmkZzvW2vuCfllJhpA

SOURCES:
I've linked my sources in the blog that goes along with this video:

https://www.moneymacro.rocks/2021-05-01-dutch-econ-response-ee/

Timestamps:
0:00 - introduction
1:43 - bad numbers
10:22 - taxes reduce inequality

Attribution:
Big thanks to Minute Marty for shooting drone footage of Groningen for me. Check out his drone shots (Create Commons License) here: https://www.youtube.com/channel/UCf_-70GwlEelR1FvRa5Dppw/videos

Narrated and produced by Dr. Joeri Schasfoort (University of Cape Town & University of Groningen)
https://twitter.com/joerischasfoort
https://www.linkedin.com/in/joeri-schasfoort/

Extended description:

The economy of the Netherlands being is the most unequal is only the case when it comes to income inequality. No, when it comes to wealth inequality the Netherlands is the worst… and this is in spite of the fact that the Netherlands has a lot of progressive social welfare policies and high taxes in place to reduce wealth inequality…

But…. As EE then tells us.

“if we look at the results in doesn’t look like they will do that at all”

Wow!!! I mean, I get it, this is exactly the type of story that economists love because it is so counter-intuitive…

After all, the richest neighborhoods in my last city of residence, beautiful Cape Town, look like this… while Cape Town’s poorest neighborhoods look like this.. On the other hand, the richest neighborhoods in my current city of Groningen, the Netherlands look like this while its poorest looks like this.

But, EE finds… using data, supposedly from the World Bank, that actually the Netherlands is the most unequal country in the world, not South Africa… So, I definitely understand why this video was a massive hit on YouTube… But, why then haven’t any other sources picked up this incredible story!?

Because it is not True.

But, before I start telling you exactly why the ‘World Bank’ numbers are incorrect in this video, let me just say that this is a ‘good faith’ response, meaning that throughout it I’ll assume that EE has made some honest mistakes that led him to a conclusion that is just totally wrong.….

The Economy of Lebanon: How to Fix its Currency Crisis

The economy of Lebanon is in a deep crisis. This video explores the [...]

The Economy of Japan: How a Superpower FELL from Grace in Four Decades

In 1989, the world was simultaneously fearful and in awe of the rise [...]

In 1989, the world was simultaneously fearful and in awe of the rise of the magnificent Japanese economy. So…. What the hell happened?

WANT TO HELP ME PRODUCE MORE CONTENT LIKE THIS?
△ Liked the in-depth research and want to help me do more? Consider buying me a coffee at https://ko-fi.com/moneymacro
△ For some extra benefits consider supporting me longer term on: https://www.patreon.com/moneymacro
△ Finally, for other one-time donations: https://www.paypal.com/donate?hosted_button_id=9JRG5URQ9KEHS

△ Interested in other country economic case studies? https://www.youtube.com/playlist?list=PLGbVoSdwvesDNHLHmkZzvW2vuCfllJhpA
△ Want to know about central banking? https://www.youtube.com/playlist?list=PLGbVoSdwvesCIGv-sN7OiQLryj2f4bAGE
△ Interested in bubbles and asset markets? https://www.youtube.com/playlist?list=PLGbVoSdwvesD_W5OHSJ6J_j-RKeCxl0OS

Narrated and produced by Dr. Joeri Schasfoort (University of Cape Town & University of Groningen)
https://twitter.com/joerischasfoort
https://www.linkedin.com/in/joeri-schasfoort/

Script and Sources:
Check out the sources (a.o. Richard Werner's books, Bank for International Settlement speeches, and Japanese newspapers) that I used for this video in the the script that you can find on my blog:

https://www.moneymacro.rocks/2021-03-22-economy-japan/

Timestamps:
0:00 - introduction
1:20 - 1980s
8:03 - 1990s
14:46 - 2000s
21:34 - 2010s
29:19 - the future & conclusion

Attribution:

clips trump protest: CC John Doyle
clips from Migrant rights protests UK CC Steve Eason
clips from Colorado immigration protests CC Unicorn Riot
clip Japanese politicians CC douga bubble
clip Disneyland opening CC Shatner Method
picture Orban & Putin CC Kremlin.ru
picture Helicopter money CC TGCP

Songs:

Ishikari Lore by Kevin MacLeod is licensed under a Creative Commons Attribution 4.0 license. https://creativecommons.org/licenses/by/4.0/
Source: http://incompetech.com/music/royalty-free/index.html?isrc=USUAN1100192
Artist: http://incompetech.com/

Further description:

While Japans economic might is still widely respected, it used to be the rising superstar of Asia. How did the economy of this Asian archipelago, which came so close to overtaking America as the number one economic superpower, end in deflation and stagnation?

I mean, by now it’s gotten so bad that the Bank of Japan, in a desperate attempt to turn this situation around, has bought up to 70% of government debt and has even become the biggest shareholder of corporate Japan.

This mini-documentary covers the period from 1979 till 2021 and spans Japan's asset bubble decade (featuring window guidance and the housing + stock bubble) as well as the three following decades that were characterized by debt-deflation and a banking crisis, the inflation expectations trap and population decline, respectively. It also has a critical look at Abenomics (from prime minister Shinzo Abe) and contains recommendations for the future of the Japanese economy.….

The Economy of Denmark: is the Krone in Trouble?

The Krone is issued by the central bank of Denmark (Danmarks [...]

Trying a Bubble Detection Algorithm on Bitcoin 2021

Is Bitcoin 2021 a bubble? I decided to ask a famous bubble detection [...]

The Balance of Payments Explained

To deal with international transactions and financial flows, [...]

Exchange Rates Explained

The prices of currencies are one of the most tricky subjects in [...]

The 4 Dangers of Financial Globalization

In these last decades, finance has become truly global. This has a lot [...]

Why Gamestop CRUSHED the Efficient Market Hypothesis

The gamestop stock explosion has mostly been told as a story of small [...]

How Banks Amplify Asset Bubbles | the Financial Cycle Explained

The financial cycle refers to a co-movement between asset prices and [...]

The financial cycle refers to a co-movement between asset prices and bank lending. While asset bubbles can definitely emerge themselves (just look at the recent Gamestop and Bitcoin stories), thanks to positive feedback loops that are inherent to these markets, when the banks join in … you better hide because that’s when they can get truly dangerous.

WANT TO HELP ME PRODUCE MORE CONTENT LIKE THIS?
△ Consider supporting me on: https://www.patreon.com/moneymacro
△ Or for one-time donations: https://www.paypal.com/donate?hosted_button_id=9JRG5URQ9KEHS

There are two elements to the financial cycle story:

1) The first is that of rising asset prices, primarily houses, but also stocks.
2) And the second is that of rising debt to GDP. Or increased bank lending.

The biggest and most recent episode of a financial cycle happened in the United States and it started … right around 1996. In this year both the level of debt compared to the size of the economy (also known as credit to GDP) and inflation adjusted house prices started to pick up. And up and up they went. And as they went up… the people were happy, the sky seemed the limit. If you want to get rich, just buy a house.

And the banks? They were more than willing to lend. After all, if a borrower could not repay the loan, he or she could sell the house. Since the price could only go up, the house sale would always yield enough money to repay the loan….

Now at the same time, it so happened that the economy was doing really well. Even a big stock market crash in 2001 could not stop the party. After that stock prices also started to pick up until….. in 2006 house prices started dropping. Then in 2007 stock prices followed, and in 2008 everything came crashing down and the world faced its biggest banking crisis in a hundred years.

Currently banks are far better regulated and are less likely to have pumped up asset prices such as those of stocks like Tesla, and Nvidia, but also about crypto assets like Bitcoin and Ethereum.

This video has been inspired by work from economists at the Bank for International Settlements such as Claudio Borio. I'm also using it in a course that I am teaching at the University of Groningen called International Financial Markets that I teach with prof. Dirk Bezemer.

Want to know more? Watch the video, or read it all in the script here: https://www.moneymacro.rocks/2021-01-27-domestic-financial-cycle/

Narrated and produced by Dr. Joeri Schasfoort (University of Cape Town)
https://twitter.com/joerischasfoort
https://www.linkedin.com/in/joeri-schasfoort/….

Who is Janet Yellen? The 2021 U.S. Treasury Secretary

Treasury secretary of the United States of America, the most powerful [...]

Treasury secretary of the United States of America, the most powerful job in finance. And the next person to do it will be Janet Yellen. So, it is important to understand what she is all about.

WANT TO HELP ME PRODUCE MORE CONTENT LIKE THIS?
△ Consider supporting me on: https://www.patreon.com/moneymacro
△ Or for one-time donations: https://www.paypal.com/donate?hosted_button_id=9JRG5URQ9KEHS

Ascending to the financial throne after Steve Mnuchin, Yellen will be responsible for U.S. economic policy, tax policy, fiscal policy, as well as managing government debt. Obviously, this is a key position for those of you living in the United States. But, it’s also key for those outside of it because of the massive role the Dollar and U.S. economy play in the global economy. After all, stimulus in the U.S. often leads to higher exports in the rest of the world.

So, with Janet Yellen being confirmed by the senate shortly (her confirmation hearing is on the 19th of January), it makes sense that you wonder who is Janet Yellen? What are her qualifications? And, most importantly, what can we expect from her tenure as Treasury secretary?

Yellen has a super impressive CV. She has a PhD from Yale, where she had some Nobel winning supervisors such as James Tobin and Joseph Stiglitz. Next, she worked at elite universities such as Harvard, the London School of Economics (LSE) and University of California Berkeley. Also, she served on several government advisory boards and was local chairwoman at the San Francisco Fed, vice chairwoman and later chairwoman at the Fed. Finally, she has published (partly co-authored with her Nobel winning husband George Akerlof) in elite journals such as the American Economic Review, Quarterly Journal of Economics, and the Journal of Monetary Economics.

She is a Keynesian economist with dovish views on the monetary policy and a tough on big business streak. But, will she be a dovish Treasury secretary as well?

Check out the full script at https://www.moneymacro.rocks/2021-01-19-yellen-treasury-secretary/

Narrated and produced by Dr. Joeri Schasfoort (University of Cape Town)
https://twitter.com/joerischasfoort
https://www.linkedin.com/in/joeri-sch...

Attribution:

- Brown university from Official YouTube channel Creative Common license
- Brookings institute from: Millennial Monitor YouTube channel Creative Common license….

How Quantitative Easing Differs from Money Printing | QE Explained

No! Quantitative Easing (QE) is not the same as money printing. This [...]

No! Quantitative Easing (QE) is not the same as money printing. This video explains exactly what the meaning of quantitative easing is and what the differences are with money printing.

WANT TO HELP ME PRODUCE MORE CONTENT LIKE THIS?
△ Consider supporting me on: https://www.patreon.com/moneymacro
△ Or for one-time donations: https://www.paypal.com/donate?hosted_button_id=9JRG5URQ9KEHS

△ Want to know more about central banking? Check out the playlist: https://www.youtube.com/playlist?list=PLGbVoSdwvesCIGv-sN7OiQLryj2f4bAGE
△ Check out how I use these principles to study country economies: https://www.youtube.com/playlist?list=PLGbVoSdwvesDNHLHmkZzvW2vuCfllJhpA

Want to know more? Watch the video, or read it all in the script here: https://www.moneymacro.rocks/2021-01-13-qe-explained/

Narrated and produced by Dr. Joeri Schasfoort (University of Cape Town)
https://twitter.com/joerischasfoort
https://www.linkedin.com/in/joeri-schasfoort/

Timestamps:
0:00 - introduction
1:01 - what QE is
1:48 - the two main differences
3:48 - why central bankers use QE

Extended description:

In 2021, we can safely say that QE has become a staple in the monetary policy toolkit of central banks such as the United States Federal Reserve (fed), European Central Bank (ECB), Bank of England, and the Bank of Japan. This policy is also known as large scale asset purchases (and monetary easing). This makes sense because this is basically what happens. However, since the central bank is doing it, new bank reserves are created to buy these bonds. The central bank thus expands it balance sheet and, since reserves are money, it increases the money supply. However, with money printing, the central bank creates notes & coins, not reserves. This is important because reserves can only be used by banks. Also, the central bank takes government (and sometimes corporate) bonds out of circulation with QE. Since bonds are also used by financial institutions to pay each other (in repo markets), it could be that effectively the money supply doesn't change much.….

The Pandemic Economics of Taiwan | a Corona Miracle?

In the year of the great Covid-19 pandemic, the economy of Taiwan grew [...]

The Monetary Economy of Athens in Ancient Greece

The silver Drachmae was basically the dollar of the Ancient [...]

The Monetary Economy of Cyberpunk | why Eurodollars?

Night City, a free city in California, uses Eurodollars rather than [...]

The Behavioral Economics of Bitcoin 2021, is it Another Bubble?

As an economist, I think the Bitcoin price rollercoaster has been one [...]

The Structure of the Monetary Financial System VISUALLY Explained

Visualization of the monetary financial system, which is built on [...]

Visualization of the monetary financial system, which is built on central bank money, thrives on private bank money, and is topped of with a large layer of other financial instruments.

WANT TO HELP ME PRODUCE MORE CONTENT LIKE THIS?
△ Consider supporting me on: https://www.patreon.com/moneymacro
△ Or for one-time donations: https://www.paypal.com/donate?hosted_button_id=9JRG5URQ9KEHS

This video builds on the academic theory which is known as the hierarchy of money. The main point of the hierarchy of money is that some forms of money are better than others. It is a theory that is very popular in post-Keynesian economics. It is also compatible with Modern Monetary Theory (MMT) since it includes money creation by both the private sector and the state.

When the economy is doing well, this hierarchy can be difficult to see. However, when there is a crisis, it will become immediately obvious that your hedge fund investments are better sold in exchange for private bank money. And when the going really gets tough, you might even be better off to run to your local bank and withdraw all of your money to walk home with a bag of cold hard cash (bank run).

I like to visualize the hierarchy of money as a circle where there is a monetary core of central bank money (including M1, M2, and M3 money, as well as reserves, that can either be created through money printing, monetary finance, or quantitative easing), a large monetary periphery of money created by private banks, and an even larger financial crust that contains all other financial instruments (such as those issued by shadow banks and money market mutual funds).

Using this visualization has helped me tremendously over the years to understand discussions in monetary and financial economics as well as international monetary systems. I hope it will do the same for you.

Want to read the script for this video? Check it out in the form of a blog post here: https://www.moneymacro.rocks/2020-12-09-money-system-visualized/

Narrated and produced by Dr. Joeri Schasfoort (University of Cape Town)
https://twitter.com/joerischasfoort
https://www.linkedin.com/in/joeri-schasfoort/

Attribution:
- Photo of Hyman Minsky by Pontificador via Wikimedia Commons….

The Economics Nobel Prize CONTROVERSY Explained

The Nobel memorial prize in economic sciences was the only prize not [...]

The 2020 Nobel Winning Simultaneous Multiple Round Auction Explained

In-depth look at how the 2020 Nobel prize was won with a revolutionary [...]

Auction Theory and Vickrey's 1996 Economics Nobel Prize Explained

In-depth look at what auction theory is, and how the 1996 Nobel prize [...]

How to Print Money without Causing Inflation

While the risk of economic catastrophe in the form of inflation, [...]

The Top 5 Strictest Coronavirus Lockdowns (1st wave)

Think you have got it tough in lockdown? Be glad you do not live in [...]

Monetary Finance Explained | the Latest Addition to the Monetary Policy Toolkit

The United Kingdom turned to monetary finance for its Coronacrisis [...]

The United Kingdom turned to monetary finance for its Coronacrisis spending. This is different from the standard Quantitative Easing approach. So, what exactly is monetary finance? Why has the UK started using it? And will it lead to inflation or even hyperinflation?

△ Want to know more about central banking? Check out the playlist: https://www.youtube.com/playlist?list=PLGbVoSdwvesCIGv-sN7OiQLryj2f4bAGE
△ Check out how I use these principles to study country economies: https://www.youtube.com/playlist?list=PLGbVoSdwvesDNHLHmkZzvW2vuCfllJhpA

For a written version of this story check out: http://www.moneymacro.rocks/2020-04-12-monetary-finance/

Narrated and produced by Dr. Joeri Schasfoort (University of Cape Town)
https://twitter.com/joerischasfoort
https://www.linkedin.com/in/joeri-schasfoort/

If this topic has peaked your interest and you would like to know more about it. I've suggested some excellent readings below:

* Between Debt and the Devil by Adair Turner, great book on money and debt by one of the most prominent proponents of monetary finance.
* Monetary Finance is here by Adair Turner (The Daily Maverick: https://www.dailymaverick.co.za/opinionista/2020-04-21-monetary-finance-is-here/)
* Is monetary finance inflationary? by Josh Ryan-Collins (Levy Economics Institute Working Paper: http://www.levyinstitute.org/pubs/wp_848.pdf)

Extended description:

Monetary finance is the latest addition to the monetary policy toolkit of central banks. It is closely related to money printing and quantitative easing, but not quite the same. Theoretically monetary financing is much more efficient than letting the government borrow via the bond market to finance its fiscal policy spending. So why not do it all the time? Well this brings us to the problem with monetary financing. And that is not about doing it per se but more about is about doing it too much.

The problem is that it is too easy. Hence, it might tempt governments to do this too much. So much so that excess money creation will increase demand for goods and services while supply cannot keep up. That is when price start to skyrocket. This is why hyperinflation happened in Zimbabwe and Venezuela when the government started printing money to finance government expenditures.

However, central bankers have told us that this is just a temporary measure and they hope that investors believe them.

But, do we believe them?….

How Central Banks Control the Money Supply with Interest Rates

Almost all central banks are cutting interest rates in response to the [...]

Almost all central banks are cutting interest rates in response to the Coronavirus. This video covers what that is supposed to do to the economy.

WANT TO HELP ME PRODUCE MORE CONTENT LIKE THIS?
△ Liked the in-depth research and want to help me do more? Consider buying me a coffee at https://ko-fi.com/moneymacro
△ For some extra benefits consider supporting me longer term on: https://www.patreon.com/moneymacro
△ Finally, for other one-time donations: https://www.paypal.com/donate?hosted_button_id=9JRG5URQ9KEHS

△ Want to know more about central banking? Check out the playlist: https://www.youtube.com/playlist?list=PLGbVoSdwvesCIGv-sN7OiQLryj2f4bAGE
△ Check out how I use these principles to study country economies: https://www.youtube.com/playlist?list=PLGbVoSdwvesDNHLHmkZzvW2vuCfllJhpA

Many people think that the central bank primarily controls the money supply (M1, M2, M3). That used to be true. However, since the bulk of money creation is done by private banks, the central bank mainly controls their money creation by setting the short term interest rate (rbi policy rate, rbi repo rate, ecb deposit rate, fed funds rate, Bank of England base rate) on bank loans and on central bank reserves. This video builds on knowledge of how private banks create money. Check that out in my other video here: https://youtu.be/cDNSNX48Kmo

In most cases, monetary policy boils down to the following. Central bank set the interest rate on which all other rates are based. By doing so they try to control the amount of money circulating in the economy indirectly by making it more or less attractive for commercial banks to lend. Most central bankers change the interest rate as they try to control inflation. They will increase the interest if they believe the economy is overheating. This will lower inflation. They decrease the interest rate to spur the economy to grow faster which will lead to increased inflation.

Monetary policy via interest rates is part of the monetary policy toolkit of central banks. In addition to that central banks can engage in money printing, monetary finance, and quantitative easing. I have separate videos on each of these topics.

Narrated and produced by Dr. Joeri Schasfoort (University of Cape Town)
https://twitter.com/joerischasfoort
https://www.linkedin.com/in/joeri-schasfoort/

Timestamps:
0:00 - introduction
0:47 - the price of money
5:23 - the quantity of money
8:50 - the goal of monetary policy
12:04 - monetary policy in practice

If this topic has peaked your interest and you would like to know more about it. I've suggested some excellent readings below:

* Big Debt Crises by Ray Dalio, great book on money and debt by one of the most well known macro hedge fund managers.
* How Global Currencies Work: Past, Present, and Future by Barry Eichengreen, Arnaud Mehl, and Livia Chitu,, awesome book for a more international view.
* Modern Money Theory: A Primer on Macroeconomics for Sovereign Monetary Systems by L. Randall Wray, the go to introduction on modern monetary theory.
* Monetary Policy Transmission in a Macroeconomic Agent-Based Model by Schasfoort, Joeri; Bezemer, Dirk; Godin, Antoine; Kinsella, Stephen; Caiani, Alessandro (paper:https://www.rug.nl/research/portal/files/56663482/Schasfoort_Godin_Bezemer_Caiani_Kinsella_SOMWP_Final.pdf), provides an overview of the different channels of monetary policy transmission.

Attribution:

- OneWorld Trade Center cc Videvo
- BNP Paribas cc Waran3
- City at night cc Videvo
- Osijek, Empty street cc ddevcic1
- ECB videos cc European Central Bank
- DB videos cc Deutsche Bundesbank
- Tokyo footagage cc ANTi….

Money & Macro Channel Trailer

The goal of the money&macro channel is to offer easily accessible [...]

How Commercial Banks Really Create Money (the Money Multiplier is a MYTH).

This video explains why fractional reserve banking and the money [...]

This video explains why fractional reserve banking and the money multiplier theory are myths and how banks do, in fact, create money.

WANT TO HELP ME PRODUCE MORE CONTENT LIKE THIS?
△ Consider supporting me on: https://www.patreon.com/moneymacro
△ Or for one-time donations: https://www.paypal.com/donate?hosted_button_id=9JRG5URQ9KEHS

△ Want to know more about money creation? Check out the playlist: https://www.youtube.com/playlist?list=PLGbVoSdwvesDGhm9l5eVWCmRkpYDGu5NS
△ Want to know more about central banking? Check out the playlist: https://www.youtube.com/playlist?list...
△ Check out how I use these principles to study country economies: https://www.youtube.com/playlist?list...

Yes, banks create money (through credit creation) but they do not do so by getting cash from you and then lending over and over till they reach the reserve requirement limit, as the money multiplier theory suggests. The reserve requirement is not a hard limit on money creation because central banks create new reserves to support healthy but cash strained banks. This is evident since, even though banks can technically ‘create money’, they can still fail because they do have to pay back that money. There are three other important soft limits on bank money creation. These are the public’s demand for debt, capital requirements, and liquidity concerns.

For a more in depth blog on this topic check out: http://www.moneymacro.rocks/2020-02-26-banks-make-money/

Narrated and produced by Dr. Joeri Schasfoort (University of Cape Town)
https://twitter.com/joerischasfoort
https://www.linkedin.com/in/joeri-schasfoort/

If you would like to go even more in depth. I suggest these excellent books:

- Where Does Money Come From?, excellent introduction on where money comes from by some of the leading forces behind the positive money movement.
- The end of alchemy, excellent book written by the former governor of the Bank of England: Mervyn King;
- Debt: The First 5,000 Years, historical account of debt as money;
- The New Paradigm in Macroeconomics: Solving the Riddle of Japanese Macroeconomic Performance, interesting account on how bank money creation powered the Japanese economic miracle;
- Modern Money Theory: A Primer on Macroeconomics for Sovereign Monetary Systems, introduction to the popular Modern Money Theory (MMT), a macroeconomic school of thought with bank money creation at the heart of it.

For some of the footage used in this video, I make the following attributions:

- Wallstreet cc Vedevo
- NYC Times Square cc Vedevo
- City at night cc Vedevo
- Dollar printing cc Panning Vedevo
- Hong Kong street level cc Vedevo
- Banks in the clouds cc Pexels
- ECB construction video cc ECB
- Deutsche Bundesbank video cc Deutsche Bundesbank….

Is the Dutch Economy Ready for the Coronavirus Fallout?

When it comes to the economic fallout of the Coronavirus, the Dutch [...]

Will the Coronavirus Trigger the Next Euro Crisis?

The Covid-19 virus will hit the Eurozone economy hard. So hard that it [...]

Dutch vs. USA Economic Model: the Complete Middle Class Experience (feat. Econoboi)

Author: admin