Central Banks Don't Create Money.

[oldfart]

I hate to spoil such a hard fought and meaningless argument; but you two have heard of the Fed funds market?

 

[Toddsterpatriot]

I hate to spoil such a hard fought and meaningless argument; but you two have heard of the Fed funds market?

Of course. I'm sure he's wrong about it as well.

 

[Pksimon2007]

- You may talk to somebody about that ego. Or maybe it's a reading comprehension problem. Or both.

Banks don't - cannot - lend out reserves. Reserves are a balance sheet account on the books of the Fed.

They can't be loaned.

https://www.kreditopferhilfe.net/docs/S_and_P__Repeat_After_Me_8_14_13.pdf

Banks don't - cannot - lend out reserves.

That's funny.

They can't be loaned.

I do ever so wish you'd tell me what they do loan.
I can always use a good laugh on a Monday.

- I already did. They create bank deposits for borrowers.

Bank deposits are money to a depositor.

- I already did. They create bank deposits for borrowers.

And when the borrower pulls out those funds, what does the borrower get?

- A check written to somebody else, which results in a transfer of those reserves (you know, the ones you said the bank loaned to somebody else) to another bank.

You really need to educate yourself on the system.

People don't get mortgages and withdraw the money in cash. derp


Let's run through your little scenario in a less sneering, more logical way.

Let's pretend banks actually could lend out reserves, just because that's your wrongheaded belief.

You deposit a check, the Fed awards the bank's reserve account with reserves in the amount of your check.

The bank makes a loan to someone else, "lending them the reserves" the bank got when it accepted your check.

You go to withdraw your money.

Where is it? According to you, the bank has nothing to pay you with.

According to me, they do.

According to REALITY, they do.

- A check written to somebody else, which results in a transfer of those reserves (you know, the ones you said the bank loaned to somebody else) to another bank.

Holy shit!
Someone borrowed money and the loan reduced the bank's reserves.
Why didn't you just admit your error the first time I laughed at your claim?

People don't get mortgages and withdraw the money in cash. derp

Umm, when the seller deposits the buyer's check, the loan money is withdrawn.
Derp indeed.

You deposit a check, the Fed awards the bank's reserve account with reserves in the amount of your check.
The bank makes a loan to someone else, "lending them the reserves" the bank got when it accepted your check.

Excellent example!

You go to withdraw your money.
Where is it? According to you, the bank has nothing to pay you with.

That is correct. If I deposited $1000 and the bank lends out $900, assuming a 10% reserve requirement, and I come back to take out any of my money, assuming no other deposits, the bank has nothing to pay me with.

According to me, they do.

By all means, explain further. I see you intend to make me laugh some more.

- Let me try one last time to drill this through your skull.

A loan is the provision, on a temporary basis, of something, to a borrower.

When a bank makes a loan, it provides a deposit account to the borrower.

It never provides reserves. It doesn't have to have reserves in order to provide a deposit account to a borrower, and it cannot provide something that is on the books of the Federal Reserve to a borrower.

Clear enough?

The DEPOSIT is the money. The bank creates it, out of nothing.

Banks are regulated, so they are limited to creating loans to a multiple of their capital. Capital is Assets - Liabilities. In the case of banks, the definition is defined by banking regulation, and is a little different than the normal definition. Central bank reserves do not count as capital, so they do not enable a bank to lend money.

A bank can create a deposit for a borrower (that is, make a loan), even if it has no other deposits. If a bank opens for business, the first deposit on their books could be a deposit THEY create for a borrower, as long as they have the capital available to make the loan. They do not need to have any reserves available in order to create the deposit.

Reserves are necessary to SERVICE deposits, that is, to honor payments made by depositors to payees who bank at other banks.

When our borrower's new deposit is used to pay a creditor, the bank will have to allow the Fed to take reserves out of its reserve account in order to make the payment happen.

That doesn't provide the borrower with reserves.

Borrowers never, ever borrow reserves, and banks never, ever lend them to borrowers.

Remember - a loan is the provision of something to a borrower. Banks never, ever provide reserves to borrowers.

I hope that clears it up for you.

 

[Pksimon2007]

- You may talk to somebody about that ego. Or maybe it's a reading comprehension problem. Or both.

Banks don't - cannot - lend out reserves. Reserves are a balance sheet account on the books of the Fed.

They can't be loaned.

https://www.kreditopferhilfe.net/docs/S_and_P__Repeat_After_Me_8_14_13.pdf

Banks don't - cannot - lend out reserves.

That's funny.

They can't be loaned.

I do ever so wish you'd tell me what they do loan.
I can always use a good laugh on a Monday.

- I already did. They create bank deposits for borrowers.

Bank deposits are money to a depositor.

- I already did. They create bank deposits for borrowers.

And when the borrower pulls out those funds, what does the borrower get?

- A check written to somebody else, which results in a transfer of those reserves (you know, the ones you said the bank loaned to somebody else) to another bank.

You really need to educate yourself on the system.

People don't get mortgages and withdraw the money in cash. derp


Let's run through your little scenario in a less sneering, more logical way.

Let's pretend banks actually could lend out reserves, just because that's your wrongheaded belief.

You deposit a check, the Fed awards the bank's reserve account with reserves in the amount of your check.

The bank makes a loan to someone else, "lending them the reserves" the bank got when it accepted your check.

You go to withdraw your money.

Where is it? According to you, the bank has nothing to pay you with.

According to me, they do.

According to REALITY, they do.

- A check written to somebody else, which results in a transfer of those reserves (you know, the ones you said the bank loaned to somebody else) to another bank.

Holy shit!
Someone borrowed money and the loan reduced the bank's reserves.
Why didn't you just admit your error the first time I laughed at your claim?

People don't get mortgages and withdraw the money in cash. derp

Umm, when the seller deposits the buyer's check, the loan money is withdrawn.
Derp indeed.

You deposit a check, the Fed awards the bank's reserve account with reserves in the amount of your check.
The bank makes a loan to someone else, "lending them the reserves" the bank got when it accepted your check.

Excellent example!

You go to withdraw your money.
Where is it? According to you, the bank has nothing to pay you with.

That is correct. If I deposited $1000 and the bank lends out $900, assuming a 10% reserve requirement, and I come back to take out any of my money, assuming no other deposits, the bank has nothing to pay me with.

According to me, they do.

By all means, explain further. I see you intend to make me laugh some more.

//That is correct. If I deposited $1000 and the bank lends out $900, assuming a 10% reserve requirement, and I come back to take out any of my money, assuming no other deposits, the bank has nothing to pay me with.//

- d-oh.

Reserves do not "come out of" deposits. Reserves are a SEPARATE currency, which live on the books of the Fed.


Do you notice how this NEVER happens? You know why?


Because banks don't freaking lends deposits.

 

[Pksimon2007]

I hate to spoil such a hard fought and meaningless argument; but you two have heard of the Fed funds market?

- Yes.

I believe I covered it in my OP.

If you have any questions about overnight loans of reserves between banks, which is what the fed funds market is, I'd be happy to answer.

 

[Pksimon2007]

I hate to spoil such a hard fought and meaningless argument; but you two have heard of the Fed funds market?

Of course. I'm sure he's wrong about it as well.

- lol!!

"You've heard of it".

Oh, good. I get to hear more about fantasy trading according to Todd.

 

[Toddsterpatriot]

Banks don't - cannot - lend out reserves.

That's funny.

They can't be loaned.

I do ever so wish you'd tell me what they do loan.
I can always use a good laugh on a Monday.

- I already did. They create bank deposits for borrowers.

Bank deposits are money to a depositor.

- I already did. They create bank deposits for borrowers.

And when the borrower pulls out those funds, what does the borrower get?

- A check written to somebody else, which results in a transfer of those reserves (you know, the ones you said the bank loaned to somebody else) to another bank.

You really need to educate yourself on the system.

People don't get mortgages and withdraw the money in cash. derp


Let's run through your little scenario in a less sneering, more logical way.

Let's pretend banks actually could lend out reserves, just because that's your wrongheaded belief.

You deposit a check, the Fed awards the bank's reserve account with reserves in the amount of your check.

The bank makes a loan to someone else, "lending them the reserves" the bank got when it accepted your check.

You go to withdraw your money.

Where is it? According to you, the bank has nothing to pay you with.

According to me, they do.

According to REALITY, they do.

- A check written to somebody else, which results in a transfer of those reserves (you know, the ones you said the bank loaned to somebody else) to another bank.

Holy shit!
Someone borrowed money and the loan reduced the bank's reserves.
Why didn't you just admit your error the first time I laughed at your claim?

People don't get mortgages and withdraw the money in cash. derp

Umm, when the seller deposits the buyer's check, the loan money is withdrawn.
Derp indeed.

You deposit a check, the Fed awards the bank's reserve account with reserves in the amount of your check.
The bank makes a loan to someone else, "lending them the reserves" the bank got when it accepted your check.

Excellent example!

You go to withdraw your money.
Where is it? According to you, the bank has nothing to pay you with.

That is correct. If I deposited $1000 and the bank lends out $900, assuming a 10% reserve requirement, and I come back to take out any of my money, assuming no other deposits, the bank has nothing to pay me with.

According to me, they do.

By all means, explain further. I see you intend to make me laugh some more.

- Let me try one last time to drill this through your skull.

A loan is the provision, on a temporary basis, of something, to a borrower.

When a bank makes a loan, it provides a deposit account to the borrower.

It never provides reserves. It doesn't have to have reserves in order to provide a deposit account to a borrower, and it cannot provide something that is on the books of the Federal Reserve to a borrower.

Clear enough?

The DEPOSIT is the money. The bank creates it, out of nothing.

Banks are regulated, so they are limited to creating loans to a multiple of their capital. Capital is Assets - Liabilities. In the case of banks, the definition is defined by banking regulation, and is a little different than the normal definition. Central bank reserves do not count as capital, so they do not enable a bank to lend money.

A bank can create a deposit for a borrower (that is, make a loan), even if it has no other deposits. If a bank opens for business, the first deposit on their books could be a deposit THEY create for a borrower, as long as they have the capital available to make the loan. They do not need to have any reserves available in order to create the deposit.

Reserves are necessary to SERVICE deposits, that is, to honor payments made by depositors to payees who bank at other banks.

When our borrower's new deposit is used to pay a creditor, the bank will have to allow the Fed to take reserves out of its reserve account in order to make the payment happen.

That doesn't provide the borrower with reserves.

Borrowers never, ever borrow reserves, and banks never, ever lend them to borrowers.

Remember - a loan is the provision of something to a borrower. Banks never, ever provide reserves to borrowers.

I hope that clears it up for you.

It never provides reserves. It doesn't have to have reserves in order to provide a deposit account to a borrower,

We've been over this.
They can, at the same instant, create a new asset offset by a new liability.
It's when that new liability is withdrawn that the reserves leave.

A bank can create a deposit for a borrower (that is, make a loan), even if it has no other deposits.

You bet. See above.

When our borrower's new deposit is used to pay a creditor, the bank will have to allow the Fed to take reserves out of its reserve account in order to make the payment happen.

Yes, the loan of reserves reduced the bank's reserves when withdrawn.

Borrowers never, ever borrow reserves, and banks never, ever lend them to borrowers.

Shit, you're stupid.
I go into my bank today to take out a personal loan for $10,000.
They open a deposit account for me. I say , "Thanks, I'd like that in $50s and $20s" Have I borrowed some of the bank's reserves?

 

[Toddsterpatriot]

Banks don't - cannot - lend out reserves.

That's funny.

They can't be loaned.

I do ever so wish you'd tell me what they do loan.
I can always use a good laugh on a Monday.

- I already did. They create bank deposits for borrowers.

Bank deposits are money to a depositor.

- I already did. They create bank deposits for borrowers.

And when the borrower pulls out those funds, what does the borrower get?

- A check written to somebody else, which results in a transfer of those reserves (you know, the ones you said the bank loaned to somebody else) to another bank.

You really need to educate yourself on the system.

People don't get mortgages and withdraw the money in cash. derp


Let's run through your little scenario in a less sneering, more logical way.

Let's pretend banks actually could lend out reserves, just because that's your wrongheaded belief.

You deposit a check, the Fed awards the bank's reserve account with reserves in the amount of your check.

The bank makes a loan to someone else, "lending them the reserves" the bank got when it accepted your check.

You go to withdraw your money.

Where is it? According to you, the bank has nothing to pay you with.

According to me, they do.

According to REALITY, they do.

- A check written to somebody else, which results in a transfer of those reserves (you know, the ones you said the bank loaned to somebody else) to another bank.

Holy shit!
Someone borrowed money and the loan reduced the bank's reserves.
Why didn't you just admit your error the first time I laughed at your claim?

People don't get mortgages and withdraw the money in cash. derp

Umm, when the seller deposits the buyer's check, the loan money is withdrawn.
Derp indeed.

You deposit a check, the Fed awards the bank's reserve account with reserves in the amount of your check.
The bank makes a loan to someone else, "lending them the reserves" the bank got when it accepted your check.

Excellent example!

You go to withdraw your money.
Where is it? According to you, the bank has nothing to pay you with.

That is correct. If I deposited $1000 and the bank lends out $900, assuming a 10% reserve requirement, and I come back to take out any of my money, assuming no other deposits, the bank has nothing to pay me with.

According to me, they do.

By all means, explain further. I see you intend to make me laugh some more.

//That is correct. If I deposited $1000 and the bank lends out $900, assuming a 10% reserve requirement, and I come back to take out any of my money, assuming no other deposits, the bank has nothing to pay me with.//

- d-oh.

Reserves do not "come out of" deposits. Reserves are a SEPARATE currency, which live on the books of the Fed.


Do you notice how this NEVER happens? You know why?


Because banks don't freaking lends deposits.

Reserves do not "come out of" deposits. Reserves are a SEPARATE currency, which live on the books of the Fed.

You've said a loan moves reserves. So you know you're wrong.

 

[Toddsterpatriot]

I hate to spoil such a hard fought and meaningless argument; but you two have heard of the Fed funds market?

- Yes.

I believe I covered it in my OP.

If you have any questions about overnight loans of reserves between banks, which is what the fed funds market is, I'd be happy to answer.

overnight loans of reserves between banks

Do you even read what you're writing?
You've said, over and over, banks don't loan reserves.
Now you admit they do.
Where you wrong then or wrong now? LOL!

 

[Pksimon2007]

- I already did. They create bank deposits for borrowers.

Bank deposits are money to a depositor.

- I already did. They create bank deposits for borrowers.

And when the borrower pulls out those funds, what does the borrower get?

- A check written to somebody else, which results in a transfer of those reserves (you know, the ones you said the bank loaned to somebody else) to another bank.

You really need to educate yourself on the system.

People don't get mortgages and withdraw the money in cash. derp


Let's run through your little scenario in a less sneering, more logical way.

Let's pretend banks actually could lend out reserves, just because that's your wrongheaded belief.

You deposit a check, the Fed awards the bank's reserve account with reserves in the amount of your check.

The bank makes a loan to someone else, "lending them the reserves" the bank got when it accepted your check.

You go to withdraw your money.

Where is it? According to you, the bank has nothing to pay you with.

According to me, they do.

According to REALITY, they do.

- A check written to somebody else, which results in a transfer of those reserves (you know, the ones you said the bank loaned to somebody else) to another bank.

Holy shit!
Someone borrowed money and the loan reduced the bank's reserves.
Why didn't you just admit your error the first time I laughed at your claim?

People don't get mortgages and withdraw the money in cash. derp

Umm, when the seller deposits the buyer's check, the loan money is withdrawn.
Derp indeed.

You deposit a check, the Fed awards the bank's reserve account with reserves in the amount of your check.
The bank makes a loan to someone else, "lending them the reserves" the bank got when it accepted your check.

Excellent example!

You go to withdraw your money.
Where is it? According to you, the bank has nothing to pay you with.

That is correct. If I deposited $1000 and the bank lends out $900, assuming a 10% reserve requirement, and I come back to take out any of my money, assuming no other deposits, the bank has nothing to pay me with.

According to me, they do.

By all means, explain further. I see you intend to make me laugh some more.

- Let me try one last time to drill this through your skull.

A loan is the provision, on a temporary basis, of something, to a borrower.

When a bank makes a loan, it provides a deposit account to the borrower.

It never provides reserves. It doesn't have to have reserves in order to provide a deposit account to a borrower, and it cannot provide something that is on the books of the Federal Reserve to a borrower.

Clear enough?

The DEPOSIT is the money. The bank creates it, out of nothing.

Banks are regulated, so they are limited to creating loans to a multiple of their capital. Capital is Assets - Liabilities. In the case of banks, the definition is defined by banking regulation, and is a little different than the normal definition. Central bank reserves do not count as capital, so they do not enable a bank to lend money.

A bank can create a deposit for a borrower (that is, make a loan), even if it has no other deposits. If a bank opens for business, the first deposit on their books could be a deposit THEY create for a borrower, as long as they have the capital available to make the loan. They do not need to have any reserves available in order to create the deposit.

Reserves are necessary to SERVICE deposits, that is, to honor payments made by depositors to payees who bank at other banks.

When our borrower's new deposit is used to pay a creditor, the bank will have to allow the Fed to take reserves out of its reserve account in order to make the payment happen.

That doesn't provide the borrower with reserves.

Borrowers never, ever borrow reserves, and banks never, ever lend them to borrowers.

Remember - a loan is the provision of something to a borrower. Banks never, ever provide reserves to borrowers.

I hope that clears it up for you.

It never provides reserves. It doesn't have to have reserves in order to provide a deposit account to a borrower,

We've been over this.
They can, at the same instant, create a new asset offset by a new liability.
It's when that new liability is withdrawn that the reserves leave.

A bank can create a deposit for a borrower (that is, make a loan), even if it has no other deposits.

You bet. See above.

When our borrower's new deposit is used to pay a creditor, the bank will have to allow the Fed to take reserves out of its reserve account in order to make the payment happen.

Yes, the loan of reserves reduced the bank's reserves when withdrawn.

Borrowers never, ever borrow reserves, and banks never, ever lend them to borrowers.

Shit, you're stupid.
I go into my bank today to take out a personal loan for $10,000.
They open a deposit account for me. I say , "Thanks, I'd like that in $50s and $20s" Have I borrowed some of the bank's reserves?

//We've been over this.
They can, at the same instant, create a new asset offset by a new liability.
It's when that new liability is withdrawn that the reserves leave.//

- Exactly. So banks don't lend reserves, and don't need to have either deposits or reserves to lend.

They create a new asset and a new liability in the same moment. They don't need either reserves or other deposits to do that.

Now, thanks for finally admitting what I dold you in the beginning.

 

[Pksimon2007]

I hate to spoil such a hard fought and meaningless argument; but you two have heard of the Fed funds market?

- Yes.

I believe I covered it in my OP.

If you have any questions about overnight loans of reserves between banks, which is what the fed funds market is, I'd be happy to answer.

overnight loans of reserves between banks

Do you even read what you're writing?
You've said, over and over, banks don't loan reserves.
Now you admit they do.
Where you wrong then or wrong now? LOL!

- You idiot.

I have been consistent, you have been a jackass.

Banks can lend reserves TO EACH OTHER.

They cannot lend them to depositors, which is the entirety of this conversation.

I really hate debating with people who have no interest in the matter, but simply want to troll.

 

[Toddsterpatriot]

I hate to spoil such a hard fought and meaningless argument; but you two have heard of the Fed funds market?

- Yes.

I believe I covered it in my OP.

If you have any questions about overnight loans of reserves between banks, which is what the fed funds market is, I'd be happy to answer.

overnight loans of reserves between banks

Do you even read what you're writing?
You've said, over and over, banks don't loan reserves.
Now you admit they do.
Where you wrong then or wrong now? LOL!

- You idiot.

I have been consistent, you have been a jackass.

Banks can lend reserves TO EACH OTHER.

They cannot lend them to depositors, which is the entirety of this conversation.

I really hate debating with people who have no interest in the matter, but simply want to troll.

Banks can lend reserves TO EACH OTHER.

I can borrow from a bank with no deposits.
My bank can borrow excess reserves from another bank to make sure the loan check does not bounce.
And that's not me borrowing reserves? LOL!

 

[Toddsterpatriot]

- I already did. They create bank deposits for borrowers.

And when the borrower pulls out those funds, what does the borrower get?

- A check written to somebody else, which results in a transfer of those reserves (you know, the ones you said the bank loaned to somebody else) to another bank.

You really need to educate yourself on the system.

People don't get mortgages and withdraw the money in cash. derp


Let's run through your little scenario in a less sneering, more logical way.

Let's pretend banks actually could lend out reserves, just because that's your wrongheaded belief.

You deposit a check, the Fed awards the bank's reserve account with reserves in the amount of your check.

The bank makes a loan to someone else, "lending them the reserves" the bank got when it accepted your check.

You go to withdraw your money.

Where is it? According to you, the bank has nothing to pay you with.

According to me, they do.

According to REALITY, they do.

- A check written to somebody else, which results in a transfer of those reserves (you know, the ones you said the bank loaned to somebody else) to another bank.

Holy shit!
Someone borrowed money and the loan reduced the bank's reserves.
Why didn't you just admit your error the first time I laughed at your claim?

People don't get mortgages and withdraw the money in cash. derp

Umm, when the seller deposits the buyer's check, the loan money is withdrawn.
Derp indeed.

You deposit a check, the Fed awards the bank's reserve account with reserves in the amount of your check.
The bank makes a loan to someone else, "lending them the reserves" the bank got when it accepted your check.

Excellent example!

You go to withdraw your money.
Where is it? According to you, the bank has nothing to pay you with.

That is correct. If I deposited $1000 and the bank lends out $900, assuming a 10% reserve requirement, and I come back to take out any of my money, assuming no other deposits, the bank has nothing to pay me with.

According to me, they do.

By all means, explain further. I see you intend to make me laugh some more.

- Let me try one last time to drill this through your skull.

A loan is the provision, on a temporary basis, of something, to a borrower.

When a bank makes a loan, it provides a deposit account to the borrower.

It never provides reserves. It doesn't have to have reserves in order to provide a deposit account to a borrower, and it cannot provide something that is on the books of the Federal Reserve to a borrower.

Clear enough?

The DEPOSIT is the money. The bank creates it, out of nothing.

Banks are regulated, so they are limited to creating loans to a multiple of their capital. Capital is Assets - Liabilities. In the case of banks, the definition is defined by banking regulation, and is a little different than the normal definition. Central bank reserves do not count as capital, so they do not enable a bank to lend money.

A bank can create a deposit for a borrower (that is, make a loan), even if it has no other deposits. If a bank opens for business, the first deposit on their books could be a deposit THEY create for a borrower, as long as they have the capital available to make the loan. They do not need to have any reserves available in order to create the deposit.

Reserves are necessary to SERVICE deposits, that is, to honor payments made by depositors to payees who bank at other banks.

When our borrower's new deposit is used to pay a creditor, the bank will have to allow the Fed to take reserves out of its reserve account in order to make the payment happen.

That doesn't provide the borrower with reserves.

Borrowers never, ever borrow reserves, and banks never, ever lend them to borrowers.

Remember - a loan is the provision of something to a borrower. Banks never, ever provide reserves to borrowers.

I hope that clears it up for you.

It never provides reserves. It doesn't have to have reserves in order to provide a deposit account to a borrower,

We've been over this.
They can, at the same instant, create a new asset offset by a new liability.
It's when that new liability is withdrawn that the reserves leave.

A bank can create a deposit for a borrower (that is, make a loan), even if it has no other deposits.

You bet. See above.

When our borrower's new deposit is used to pay a creditor, the bank will have to allow the Fed to take reserves out of its reserve account in order to make the payment happen.

Yes, the loan of reserves reduced the bank's reserves when withdrawn.

Borrowers never, ever borrow reserves, and banks never, ever lend them to borrowers.

Shit, you're stupid.
I go into my bank today to take out a personal loan for $10,000.
They open a deposit account for me. I say , "Thanks, I'd like that in $50s and $20s" Have I borrowed some of the bank's reserves?

//We've been over this.
They can, at the same instant, create a new asset offset by a new liability.
It's when that new liability is withdrawn that the reserves leave.//

- Exactly. So banks don't lend reserves, and don't need to have either deposits or reserves to lend.

They create a new asset and a new liability in the same moment. They don't need either reserves or other deposits to do that.

Now, thanks for finally admitting what I dold you in the beginning.

Exactly. So banks don't lend reserves, and don't need to have either deposits or reserves to lend.

And that works until the loan check clears. Then the bank needs reserves to cover the debit in their reserve account at the Fed.

 

[Pksimon2007]

I hate to spoil such a hard fought and meaningless argument; but you two have heard of the Fed funds market?

- Yes.

I believe I covered it in my OP.

If you have any questions about overnight loans of reserves between banks, which is what the fed funds market is, I'd be happy to answer.

overnight loans of reserves between banks

Do you even read what you're writing?
You've said, over and over, banks don't loan reserves.
Now you admit they do.
Where you wrong then or wrong now? LOL!

- You idiot.

I have been consistent, you have been a jackass.

Banks can lend reserves TO EACH OTHER.

They cannot lend them to depositors, which is the entirety of this conversation.

I really hate debating with people who have no interest in the matter, but simply want to troll.

Banks can lend reserves TO EACH OTHER.

I can borrow from a bank with no deposits.
My bank can borrow excess reserves from another bank to make sure the loan check does not bounce.
And that's not me borrowing reserves? LOL!

- Or a bank can buy reserves from the Fed. For that matter, they can BUY them from another bank.

So no, it's not you borrowing reserves. You borrowing does not require the bank to do anything in particular with reserves. It's up to the bank, and has nothing to do with you.

Your original contention was that banks loaned deposits. Then you decided they didn't lend deposits, but loaned reserves.

You've admitted you were wrong, and are now trying to find some twist of words that will make you seem not to have been so wrong as you were.

 

[Toddsterpatriot]

Borrowers never, ever borrow reserves, and banks never, ever lend them to borrowers.

Shit, you're stupid.
I go into my bank today to take out a personal loan for $10,000.
They open a deposit account for me. I say , "Thanks, I'd like that in $50s and $20s" Have I borrowed some of the bank's reserves?

 

[oldfart]

Sigh......

 

[Pksimon2007]

Borrowers never, ever borrow reserves, and banks never, ever lend them to borrowers.

Shit, you're stupid.
I go into my bank today to take out a personal loan for $10,000.
They open a deposit account for me. I say , "Thanks, I'd like that in $50s and $20s" Have I borrowed some of the bank's reserves?

- No.

Cash isn't reserves.

Cash can be used to offset a reserve requirement, but reserves are deposits created by the Fed in favor of banks in their reserve accounts at the Fed.

 

[Toddsterpatriot]

Banks can lend reserves TO EACH OTHER.

I can borrow from a bank with no deposits.
My bank can borrow excess reserves from another bank to make sure the loan check does not bounce.
And that's not me borrowing reserves? LOL!

- Or a bank can buy reserves from the Fed. For that matter, they can BUY them from another bank.

So no, it's not you borrowing reserves. You borrowing does not require the bank to do anything in particular with reserves. It's up to the bank, and has nothing to do with you.

Your original contention was that banks loaned deposits. Then you decided they didn't lend deposits, but loaned reserves.

You've admitted you were wrong, and are now trying to find some twist of words that will make you seem not to have been so wrong as you were.

Yes, it's funny how they need to buy or borrow reserves because of my loan.
The loan that you claim is not reserves.

Your original contention was that banks loaned deposits.

That is usually the cheapest way to get the excess, lendable reserves.

 

[Toddsterpatriot]

Borrowers never, ever borrow reserves, and banks never, ever lend them to borrowers.

Shit, you're stupid.
I go into my bank today to take out a personal loan for $10,000.
They open a deposit account for me. I say , "Thanks, I'd like that in $50s and $20s" Have I borrowed some of the bank's reserves?

- No.

Cash isn't reserves.

Cash can be used to offset a reserve requirement, but reserves are deposits created by the Fed in favor of banks in their reserve accounts at the Fed.

Cash isn't reserves.

Vault cash is part of reserves.

 

[Pksimon2007]

Sigh......

- Oldfart, the issue we are discussing right now is an issue that most economists don't understand. Economists who don't understand this issue largely didn't see the 2008 financial crisis coming. There's a connection there. Economists who think that central bank policy dictates credit market outcomes usually get their predictions wrong.