How is money really made by banks? - Banking 101 (Part 3 of 6)

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PART 3: How is money really made by banks?
Three Forms of Money - 00:02
The Balloon Model - 03:01
What determines the amount of money in the economy? - 05:18
Exactly how banks create money out of nothing - 06:20
Inter-bank settlement: One payment - 09:35
Inter-bank settlement: Multiple payments - 12:40
Fractional reserve banking - 15:03
Reserve accounts & Real-time gross settlement - 16:10
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POSITIVE MONEY is a not-for-profit research and campaign group. They work to raise awareness of the connections between our current monetary and banking system and the serious social, economic and ecological problems that face the UK and the world today. In particular they focus on the role of banks in creating the nation's money supply through the accounting process they use when they make loans - an aspect of banking which is poorly understood. Positive Money believe these fundamental flaws are at the root of - or a major contributor to - problems of poverty, excessive debt, growing inequality and environmental degradation. For more information, please visit: http://www.positivemoney.org/
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