The Creation of the Federal Reserve System (Part 4)

Funny, you're the one who keeps talking about how smart you are and how dumb everyone else is, like me, Bacardi, hoytmonger, snooop, Iriemon, etc. and you're constantly being proven wrong so you resort to making silly claims like "your sandwich exists before you make it". Or your most recent one, "the Fed doesn't create more money when it creates more money" which backed you into a corner where you're trying to tell me that the money multiplier doesn't exist. (This is of course completely ignoring the fact that we had thousands of posts and hundreds of pages discussing banking theory assuming the textbook multiplier theory as a basic axiom.)

What is it that you're trying to prove at this point, akphidelt? Has your ego been shattered?

 

You guys are the only ones that assumed the textbook multiplier theory. I have told you from the beginning that banks do not rely on reserves to make loans. You guys are the ones that continually based your banking theory on this fact that banks need reserves to make loans because of this money multiplier.

I showed you source after source saying that reserves do not serve the same purpose as they did before and that banks need capital not reserves to make loans. But nope, you guys continued on with your textbook theory while all along all I was doing is telling you what the Fed is saying.

Everything I'm saying to you guys is not a theory, it is simply what the Fed says. You guys are the ones making stuff up that doesn't exist in our monetary system.

Sorry about your bad luck!

 

So you now agree that banks do not need reserves to make loans. That's the first step to understanding what I'm saying. Good job!! We are making progress.

Yes, the paper says there is no correlation between deposits and loans. Maybe you just don't understand what they are saying. I suggest you actually read the paper.

Liar. I said you haven't mentioned it until today and I asked for you to prove that you have mentioned it before. But you didn't because you can't because you're a liar.

According to the Federal Reserve more reserves does not equal more loans. Once again I will believe the Federal Reserve over you. Thanks for your opinion though.

What does this have to do with capital reserves?

No, it says based on it's analysis the multiplier does not exist in our system. Do you have this much trouble comprehending things? Embarrassing. My little nephew could understand what they are saying.

Already did.

Banks lend reserves to each other. They do not lend reserves to the nonbank public.

Because it is true

LOL!!! Capital reserves are not included as excess reserves. Nice try!

False, you are just blatantly lying now

Sure it does. It says they need to come up with another mechanism to explain how our system works, which means our system can not be explained by the textbook multiplier effect. You need to learn how to read bro!

Already showed you

Please explain to me how the Fed creates Capital reserves, lol.

Great insult!

Just repeating what they say. You are the one making up your own crazy theories.

If I don't understand how it works than the Fed doesn't understand how it works.

 

Changes in reserves are unrelated to changes in lending, and open market operations do not have a direct impact on lending. We conclude that the textbook treatment of money in the transmission mechanism can be rejected. Specifically, our results indicate that bank loan supply does not respond to changes in monetary policy through a bank lending channel, no matter how we group the banks.



Please apologize immediately! Thank you!

 

Dude, you are wrong....so very wrong. So unbelievably wrong. It causes me to lose sleep at night with how wrong you are. It's been proven to you that the IMF is going to replace the USD as the world reserve currency with a new currency backed by IMF SDRs. The dollar is not going to be so great once that happens. Nobody is going to want dollars when that happens and they'll all come back to our shores. Then take a guess what's going to happen when you couple that with Kamikaze Ben's trillions of dollars worth of reserve creations.

 

Nothing in that statement contradicts anything I said. I agree 100% with that statement.

Why would I apologize to you for something which you are completely wrong about?

 

LOL!!! So you now 100% agree that the money multiplier doesn't exist in our system after saying it did? You should be a politician with the flip-flopping you do.

What am I wrong about? Lol

 

You two need to get a room.

 

LOL!!! You guys don't even understand how the banking system works and now you are trying to lecture me on what happens when we lose world reserve currency status?? LOL!!! Make me laugh some more puppet.

 

I'm doing no such thing. Nothing you've posted proves that the money multiplier "doesn't exist".

I haven't flip flopped once. My points have been completely consistent.

Your erroneous claim that the money multiplier "doesn't exist".

 

Nice ad-hominem logical fallacy. I'll take that as an admission of defeat.

 

LOL!!! Just because the Fed does not write papers in your reading comprehension level does not mean they aren't saying the money multiplier doesn't exist. The textbook multiplier which you have referenced numerous times indicates that an increase in deposits correlates to an increase in loans. An increase in reserves correlates to an increase in loans.

And than the Fed concludes
Changes in reserves are unrelated to changes in lending

And now you are saying you agree 100% with them??? Hahahahahahahahahahaha

Maybe you just don't understand what the Fed is saying. Because if you still think the Fed says the multiplier exists than you have major problems.

It doesn't exist.

 

LOL!! Going back 4 pages, here is couple Dr. R quotes that obviously displays that he does not agree with the Fed that changes in reserves are not linked to changes in loans and the fact he still believes in the textbook money multiplier.

Hahahahahahahahahahahahahahahahahahahaha!!!!!

 

And what's even funnier is now you are talking about velocity, demand for loans, capital reserves, and equity!! Welcome to the real world of banking... I'm glad I was able to teach you how it works. But it would be very grateful of you to say Thank You!!

 

Please show me where in the paper the Fed says that the money multiplier "doesn't exist".

You have referenced the same textbook multiplier throughout the course of this entire thread. It was a basic axiom we all were assuming for the purposes of discussing fractional reserve banking theory.

And that's completely factual. Our current economy is evidence of that. A slow velocity of money means banks aren't lending, so changing reserves will do nothing. The Fed pumped $1.5T into bank reserves over the past 3 years. If changes in reserves were related to changes in lending, then we would be seeing runaway inflation right now.

I always agree with the Fed sources because they are 100% accurate.

You have yet to show me where the Fed says that the money multiplier "doesn't exist".

 

The first two quotes you have taken out of context because you're a troll; it was assuming a textbook multiplier for the purposes of discussing theory. The last quote you posted was using figures from your own source and not an example of a discussion of textbook multiplier, which further proves you either have no idea what you're talking about or you're just trolling.

 

LOL. You didn't even know what velocity of money was until two pages ago. What are you talking about? You're so embarassing.

 

They don't use your idiot terminology, lol.

Changes in reserves are unrelated to changes in lending

Way to change the goal post. Hahahaha

Thanks

It doesn't say the words "doesn't exist" because they don't write like 3rd graders like yourself.

 

Of course I know what the velocity of money is. I don't get how the velocity of money has anything to do with banks needing reserves to make loans though, hahahahaha.

 

There is nothing from that quote that can derive the remotest implication that the money multiplier "doesn't exist". You're just making stuff up.

I haven't changed the goal post. I'm merely correcting your incorrect interpretation of what the Fed is saying in the paper.

There is nothing from that quote that can derive the remotest implication that the money multiplier "doesn't exist".

 

Wow, you are a very good debater, lol. You have transformed yourself in to my position and you are trying to educate me on the very position I was trying to educate you on, hahahahahaha.

Face it, you realized I was right and you had to change your stance. You thought this entire time that the textbook multiplier existed and that banks were dependent on reserves to make loans.

I have said 1000 times that banks do not need reserves to make loans and that banks simply loan to whomever meets their lending standards.

Please apologize for being a chronic liar and fraud. Thanks!

 

Than you don't know what the money multiplier is.

Lol, uh huh. Keep trying to backtrack yourself out of this one. This is a happy day for me. You finally realized you were wrong and I was right!!! Hallelujah!!! Akphidelt converted a man in to intelligence!

For someone as uneducated as yourself it wouldn't. Lol!!

Maybe I can write you a 3rd grade essay paper on what the Fed is trying to say, since that language is obviously too advanced for your comprehension level.

 

No such thing has occured.

No I didn't. It's common sense that it wouldn't play out by textbook. It's just a theory to help folks understand how the system works. But to say that deposits aren't multiplied is absolutely ludicrous. If deposits weren't multiplied, why would bank runs occur? Why does the FDIC exist? Why does the Fed need to bail out banks?

Think about that for a LONG time why your position is totally illogical, and then write a 3,000 word essay, by hand, about why the money multiplier exists but does not operate in textbook fashion, and then attach a 1,000 word apology, as an appendix, written by hand, and mail it to me.

Wrong. They are completely dependent on excess reserves to make loans, which include capital reserves. This is a completely uncontroversial statement.

Sure.

(*)(*)(*)(*) you. (*)(*)(*)(*)(*)(*)(*).

 

Don't be silly. Of course I know what the money multiplier is. How do you think Iriemon and I were able to educate you about how there is no cash in deposit accounts?

Nothing you said here has any substance. It's just full of trolling fluff.

 

Here's another astute post made by the serial flip flopping fraud...

If a bank starts out with $10, then it loans it out until it turns into $100 worth of deposits. If there is a run on the bank, then the Fed has to create $90 worth of cash to satisfy everyone. Now there is $100 cash circulating outside of bank vaults, which all come back into the bank as deposits. That $100 then turns into $1000, which very much creates more money.


And now he is saying he agrees 100% with the FED and me!!!

hahahahahaha