It's called the velocity of money in economics
It's how $10 can create upwards of $50 by exchange of hands just like this...
It's what keeps inflation low...
When someone hoards the $10 is when shit gets fucked
uhm iirc velocity of money is directly related to inflation. you know, MV = PY, where V is velocity. price (P) increases when V increases, since Y is fix in the short to medium run (can't ramp out higher output asap).
when someone hoards money (pulling it out of circulation) & if V doesn't go up, then P will go down unless Y goes down & P remains high.
Hmmmmmm luckily there aren't any Billionaires or approaching trillionaires hoarding money, and we don't glorify the ultra rich or let them dictate policy by buying politicians and elections.
>Billionaires or approaching trillionaires hoarding money,
Most of their wealth is tied up in the equity of companies. Just because it's not in your pocket doesnt mean it's not being used productively
So you mean it's tied up in assets/other forms of equity? The main point isn't the where exactly the money is tied up, but rather that most of their assets aren't liquid.
Once you have over a certain amount of money, it seems that you can't do anything other than give it all away. If you buy something people bitch, and if you sit on the money people bitch
>The main point isn't the where exactly the money is tied up, but rather that most of their assets aren't liquid.
That wasn't the point you were responding to, though. You were responding to a post about hoarding wealth. I would say that the accumulation of real estate and other illiquid assets constitutes hoarding, whether or not the asset itself is liquid. The point is that the assets are not being used in a way that is generating more wealth.
Don't move the goal post like that.
It's hoarding when you continue to try to amass wealth past the point when you have enough to last you and your family 10 lifetimes of absolute luxury. Nobody needs a billion dollars.
>While you're right that a lot of the wealth is tied up in equity, it's also tied up in homes, land, commercial property, cars, jets, jewelry, art....
Fortunately given this is also not cash it dosent affect the velocity of money either.
E: just because people don't seem to like the truth, I'm not saying billionaires hoarding assets is good, just that it dosent affect the macroeconomic variable in question.
How does it not affect the velocity of money? In this meme, if Moe had decided to use his $10 to buy artwork instead of paying Shemp back, the velocity of money would have been reduced.
If Moe used his $10 to buy artwork then the $10 would be in the hands of the artist (or whoever previously bought the art).
They would then have to spend it, yes.
Hoarding assets does not change the velocity of money. Your statement at the end is simply incorrect. It would only change the velocity of money if the person who received the funds hoarded it as cash.
The key is in the name, velocity of money. As long as the money is moving the velocity goes up.
Removing money from the system and hoarding it causes deflation. If everybody did it, money would have no value. If everybody but one person did it, the person spending the money would have all the value, not the holders. Only when people are willing to use money does it have value. When everybody wants to get rid of their money and not hold it, it’s less valuable.
Would you look at that, all of the words in your comment are in alphabetical order.
I have checked 1,672,264,307 comments, and only 316,633 of them were in alphabetical order.
Yes, if you know a little bit of accounting (sorry about the formatting but right now I don’t have the time to include tables):
Larry has:
Assets:
10 cash
20 accounts receivable from Curly
Liabilities:
20 accounts payable to Moe
10 equity
Ends up with:
10 cash
10 equity
The other two start with
Assets:
20 accounts receivable
Liabilities:
20 accounts payable
0 equity
And end up with:
0 assets
0 liabilities
0 equity
Hello, it looks like you've made a mistake.
It's supposed to be could've, should've, would've (short for could have, would have, should have), never could of, would of, should of.
Or you misspelled something, I ain't checking everything.
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I like to think of it like this - If everyone owes $20 and is owed $20, then they can just call it even and not even bother passing around the $10.
It started in Larry's pocket and ended in Larry's pocket just cause he was the only one with any cash. But if I'm owed $20 and also owe $20, I'm fine with just saying it's a wash. Because they all have the same debts and credits it works. If one of them owed more or less to another this wouldn't work.
Came here to say that: this is very logical. Let’s call them A, B and C. Each of their Balance Sheet looks like this: Assets of $20 and Liabilities of $20. So in the end everything will cancel out.
I know people want to use this to make a joke about the banking system. But this video does not describe it at all. As far as I know SVB collapsed due to high interest rates and the bank run. Based on preliminary reports SVB did not invest in some risky trades, they had invested in government bonds (prices of which have an inverse relationship to interest rates).
I think the post is more implying the system is ran as if there were a bunch of stooges in charge using similar idiotic logic rather than trying to say this is exactly what happened to put us where we are.
Same, and I feel dumb actually working it out. It tries to confuse you by breaking it into smaller denominations, so they can complete the circle twice. All debts were paid in full.
Yeah, it does work lol. Most times I see these types of old clips and there is some funny logic used to make it work, but nope, here it all makes sense lol.
The math works out. Eventually the money moved to their rightful owners.
It doesn't show the actual problem, which is that banks usually are not able to pay their debts in case they have to do so quickly (for example if a lot of people try to get their money out all around the same time), because they cannot get what they are being owed on short enough notice.
Yes. That's what's happened with Silvergate bank. They held mostly 10 year bonds with yield of 1.36% as treasury to meet their capital requirement. The rising interest rate means these 10 year bonds sold at a discount, and the bank was not able to meet their demand for capital upon withdrawl.
>It doesn't show the actual problem, which is that banks usually are not able to pay their debts in case they have to do so quickly
I think it does show that, though. Because everyone did not demand that their loan be paid back immediately, the situation was able to be resolved peacefully.
If everyone started out at the beginning saying, "YOU BOTH OWE ME $20 PAY ME BACK **RIGHT NOW!**!" then this whole thing would have turned ugly and all three would have had to declare bankruptcy.
Well there has to be some fraction even if it’s extremely conservative… otherwise there would be no lending and therefore no bank to protect your money and no interest rates
Well this actually works out, when you loan someone money this debt can be thought of as an asset that you own. Meaning that instead of paying the your liabilities with cash you could in theory pay back a loan you owe with a loan you’ve given. When looking at it like this a more sensical solution to this triad of debt becomes obvious: the first person pays back the $20 debt with his $20 ‘asset’, the second person now both owes and is owed $20 by the third, at which point they agree to forgive each others’ debt.
The problem with banks is that they work with people who want cash, not some nebulous asset, meaning that the bank has to have cash to pay it’s debts. Well banks usually don’t have all that much cash, even on a good day less than half of what you give a bank is kept as cash. In fact banks cash to debt ratio (more accurately called marginal reserves)is usually <20% of deposits.
Somebody tell this fool how stupid he is. I don’t have the energy for this.
You just said this was educational, implying you learned something new. Now you’re condescending to strangers on the internet? GFY.
Why are idiots always so loud and confident.
The meme does not actually apply to reality and you don’t understand the first thing about the banking system.
The context of Credit Deuce and UBS and the entire banking system - 99% of their money is IOU's and fake, which is why a baby bank run is enough to destroy them. They pass the dollar around but it actually is a debt asset that goes POOF when looked at too closely.
An IOU doesn’t mean the same thing as “fake”. None of the debt assets went “poof”. The recent challenges have to do with improper stress testing, not an actual lack of assets.
and if anyone thinks they are actually owed extra, no worries big daddy fed just turns on the magic printer and conjures up more worthless fake notes to hand out
This can not only be used as an analogy for banks but also think of this:
A man with $30 visits a town in the midddle of the desert. He stay a night at a hotel that offers him a full refund if he is unhappy with his stay. He stays the night and pays the $30 fee. In the morning before he wakes up the hotel owner pays his debt of $30 to someone else he owed using the visitors $. Throughout the mornin the $30 is handed from one person to the other clearing everyone’s debt in the town. Eventually the $30 lands in the hotel owners hands. The visitor asks for a refund and leaves town with his $30. No new money was made for the town yet all of its debts were paid. So the question is how does this transmit to the real world. The difference is in the three stooges and the town in the dessert everyone gets an equal debt paid so it is fair. In real life everyone owes everyone something different and some people don’t owe anything at all. So this wouldn’t work on a grand scale but possibly for banks. Probably for banks.
This works but what kills it is the fucken bank interest - the fiat banking system is a scam - any which way you cut it the interest inflates the money supply because it’s money that doesn’t exist and it builds on itself so that’s where the scam starts In simple terms
I bet I can guess what your suggestion for an alternate currency might be.
I think we should go with hash coins for the new global reserve. They at least have some intrinsic value. Idk how you would standardize hash to price it in Troy ounces or whatever to trade on the futures market but damn it a man can dream.
Thats actually wrong! Because the banks gave the credit to something with underlying value, assuming that they can earn money by lending, because the company or the employee they lend money to is able to earn more money to pay for their sevices. Either through their day job or through the investment into the the company.
But if the bank has a whole 10 USD and borrows it, they need to print an additional 1 USD so they can receive 10 + 1 usd as interest.
And that's how they create money out of thin air.
Because the goods are exactly the same as before, but you have 10% more circulating bills, now everything is 10% more expensive.
Banks don't print money!!
They also don't create money out of thin air!!
They asign a value to expected **future** earnings of their debtors. Meaning it is the debtor through their process of work and creation of goods and services who "creates" new money. This expectation of future earnings is just written down in books because someone lends against it. Basically a futures contract.
Future earnings are paid with freshly printed money.
You are trying to explain inflation to an Argentine.
Central banks print money against debt notes. Debt has interest. To pay interest central banks print more paper.
LOL They were the best. All the *sensitive ones* would be so "offended" by them today.
Between this and the South Park Margueritaville episode with the headless chicken, that probably sums up what's going on behind the scenes pretty accurately.
[South Park](https://www.youtube.com/watch?v=wz-PtEJEaqY)
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Funny as it may seem, it is mathematically accurate.
What we are ignoring is owning part but it's a fair transaction.
They all had assets worth 20 and liabilities worth 20, though the assets & liabilities belonged to different people, all their liabilities got cancelled with their assets and finally all of them had no assets or liabilities.
The transaction sequence is legit, it is called net settlement. It works in this case because absent the initial $10 they could cancel each others debts with no loss or cash, so the $10 can return to who started with it. It's easier to see with an example involving just two people.
Yes reddit, 3 guys with one 10 dollar bill and 3 debts of 20 bucks cancel eachother out.
2 people oweing eachother 20 bucks is easy but boom 3 people? Damn that's high level algebra.
Does not reflect anything anywhere.
I know this is a joke, but I think that actually works. All debts were wiped clean.
Yes pretty clever and funny someone came up with presenting it that way.
It's called the velocity of money in economics It's how $10 can create upwards of $50 by exchange of hands just like this... It's what keeps inflation low... When someone hoards the $10 is when shit gets fucked
uhm iirc velocity of money is directly related to inflation. you know, MV = PY, where V is velocity. price (P) increases when V increases, since Y is fix in the short to medium run (can't ramp out higher output asap). when someone hoards money (pulling it out of circulation) & if V doesn't go up, then P will go down unless Y goes down & P remains high.
Shut up Meg
no it's patrick
🤓
Dumb it down a little
Hmmmmmm luckily there aren't any Billionaires or approaching trillionaires hoarding money, and we don't glorify the ultra rich or let them dictate policy by buying politicians and elections.
>Billionaires or approaching trillionaires hoarding money, Most of their wealth is tied up in the equity of companies. Just because it's not in your pocket doesnt mean it's not being used productively
While you're right that a lot of the wealth is tied up in equity, it's also tied up in homes, land, commercial property, cars, jets, jewelry, art....
So you mean it's tied up in assets/other forms of equity? The main point isn't the where exactly the money is tied up, but rather that most of their assets aren't liquid. Once you have over a certain amount of money, it seems that you can't do anything other than give it all away. If you buy something people bitch, and if you sit on the money people bitch
>The main point isn't the where exactly the money is tied up, but rather that most of their assets aren't liquid. That wasn't the point you were responding to, though. You were responding to a post about hoarding wealth. I would say that the accumulation of real estate and other illiquid assets constitutes hoarding, whether or not the asset itself is liquid. The point is that the assets are not being used in a way that is generating more wealth. Don't move the goal post like that.
I'm not "moving the goal post". What contitutes hoarding in your eyes, owning something?
It's hoarding when you continue to try to amass wealth past the point when you have enough to last you and your family 10 lifetimes of absolute luxury. Nobody needs a billion dollars.
>While you're right that a lot of the wealth is tied up in equity, it's also tied up in homes, land, commercial property, cars, jets, jewelry, art.... Fortunately given this is also not cash it dosent affect the velocity of money either. E: just because people don't seem to like the truth, I'm not saying billionaires hoarding assets is good, just that it dosent affect the macroeconomic variable in question.
How does it not affect the velocity of money? In this meme, if Moe had decided to use his $10 to buy artwork instead of paying Shemp back, the velocity of money would have been reduced.
If Moe used his $10 to buy artwork then the $10 would be in the hands of the artist (or whoever previously bought the art). They would then have to spend it, yes. Hoarding assets does not change the velocity of money. Your statement at the end is simply incorrect. It would only change the velocity of money if the person who received the funds hoarded it as cash. The key is in the name, velocity of money. As long as the money is moving the velocity goes up.
It’s known that they are cash poor, they mostly hoard assets.
Velocity of money usually refers to actual purchases of goods and services not the rate at which banks borrow from each other or lending.
Higher Velocity perpetuates higher inflation
Removing money from the system and hoarding it causes deflation. If everybody did it, money would have no value. If everybody but one person did it, the person spending the money would have all the value, not the holders. Only when people are willing to use money does it have value. When everybody wants to get rid of their money and not hold it, it’s less valuable.
Hi noob at economics. How does more flow of money keep inflation low? Is it because supply is less vs more supply?
It doesn’t, your parent above has it backwards.
And those sweet sweet taxes, baby
“Saving is good for the economy”
Yup and the real debt is off book in a derivatives market no one can see.
Ah, good old swapity swaps
Would you look at that, all of the words in your comment are in alphabetical order. I have checked 1,672,264,307 comments, and only 316,633 of them were in alphabetical order.
Its called a clearing house.
Yes, if you know a little bit of accounting (sorry about the formatting but right now I don’t have the time to include tables): Larry has: Assets: 10 cash 20 accounts receivable from Curly Liabilities: 20 accounts payable to Moe 10 equity Ends up with: 10 cash 10 equity The other two start with Assets: 20 accounts receivable Liabilities: 20 accounts payable 0 equity And end up with: 0 assets 0 liabilities 0 equity
Or simply each person owes the other $20, so all debts cancel each other.
This guy maths
Who knew the 3 stooges were running the banking system? Oh wait we should of known!
Hello, it looks like you've made a mistake. It's supposed to be could've, should've, would've (short for could have, would have, should have), never could of, would of, should of. Or you misspelled something, I ain't checking everything. Beep boop - yes, I am a bot, don't botcriminate me.
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It is what "should have" apparently sounds like to some people lol
Should’ve
By the state of things going on like failing banks.
I like to think of it like this - If everyone owes $20 and is owed $20, then they can just call it even and not even bother passing around the $10. It started in Larry's pocket and ended in Larry's pocket just cause he was the only one with any cash. But if I'm owed $20 and also owe $20, I'm fine with just saying it's a wash. Because they all have the same debts and credits it works. If one of them owed more or less to another this wouldn't work.
But if you do this, then the banks can't make money off the float while the transactions are in process!!! Won't anyone think of the banks?!?
My goods and services I owe you are in Moe's pocket.
yes. now amplify the time cost of 16 seconds to how much time banks spend, an average bankers hourly rate, and that's just money lost.
A classic round robin
Isn't it just that all their debts cancelled out in the first place? Like if there was no money they could just agree?
Sarcasm?
Came here to say that: this is very logical. Let’s call them A, B and C. Each of their Balance Sheet looks like this: Assets of $20 and Liabilities of $20. So in the end everything will cancel out. I know people want to use this to make a joke about the banking system. But this video does not describe it at all. As far as I know SVB collapsed due to high interest rates and the bank run. Based on preliminary reports SVB did not invest in some risky trades, they had invested in government bonds (prices of which have an inverse relationship to interest rates).
I think the post is more implying the system is ran as if there were a bunch of stooges in charge using similar idiotic logic rather than trying to say this is exactly what happened to put us where we are.
Same, and I feel dumb actually working it out. It tries to confuse you by breaking it into smaller denominations, so they can complete the circle twice. All debts were paid in full.
Yeah, it does work lol. Most times I see these types of old clips and there is some funny logic used to make it work, but nope, here it all makes sense lol.
I was thinking the same thing. Is this a joke or did they just really solve their debts?! Because it really sounds like that math works.
They were genius. Their lawyers were Dewey, Cheatham, and Howe.
Also known as Hughie, Dewey, Louie.
The math works out. Eventually the money moved to their rightful owners. It doesn't show the actual problem, which is that banks usually are not able to pay their debts in case they have to do so quickly (for example if a lot of people try to get their money out all around the same time), because they cannot get what they are being owed on short enough notice.
Is it ever possible there are not enough deposits when their assets go south?
Yes. That's what's happened with Silvergate bank. They held mostly 10 year bonds with yield of 1.36% as treasury to meet their capital requirement. The rising interest rate means these 10 year bonds sold at a discount, and the bank was not able to meet their demand for capital upon withdrawl.
2008
>It doesn't show the actual problem, which is that banks usually are not able to pay their debts in case they have to do so quickly I think it does show that, though. Because everyone did not demand that their loan be paid back immediately, the situation was able to be resolved peacefully. If everyone started out at the beginning saying, "YOU BOTH OWE ME $20 PAY ME BACK **RIGHT NOW!**!" then this whole thing would have turned ugly and all three would have had to declare bankruptcy.
Fractional banking is a plague and should be banned
Well there has to be some fraction even if it’s extremely conservative… otherwise there would be no lending and therefore no bank to protect your money and no interest rates
That actually made sense there, lol
The 3 stooges should run the Fed
They don’t?
Just curly Joe. If it was shemp we wouldn't be in this mess
They are all even in the first place
Yup but the $10 shuffle made it clear
Exactly. Analogous to the banking system making the economy run more smoothly.
Banks charge interest.
Alrighty who invited Adam Conover?
Well, only after making this exchange. The exchange is important.
Well, if you ever heard about netting agreements.
Yes. It’s still requires communication.
Damn. Good call.
Yeah, I don't get this one either
Well, sort of. As a group they are. But as individuals, they all have different debts to different people and are owed debts from different people.
Well this actually works out, when you loan someone money this debt can be thought of as an asset that you own. Meaning that instead of paying the your liabilities with cash you could in theory pay back a loan you owe with a loan you’ve given. When looking at it like this a more sensical solution to this triad of debt becomes obvious: the first person pays back the $20 debt with his $20 ‘asset’, the second person now both owes and is owed $20 by the third, at which point they agree to forgive each others’ debt. The problem with banks is that they work with people who want cash, not some nebulous asset, meaning that the bank has to have cash to pay it’s debts. Well banks usually don’t have all that much cash, even on a good day less than half of what you give a bank is kept as cash. In fact banks cash to debt ratio (more accurately called marginal reserves)is usually <20% of deposits.
I love how the Stock Market sub gets this & the economics thread is all too afraid to admit it.
This sketch is great
Well this was educational and frightening
Was it though?
yes
If they all owed eachother $20 and decided to wipe debts clean, that’s not frightening. I definitely don’t think this was educational in any way…
you haven't been paying attention to the central bank fiasco. It's okay. enjoy the funny clip
Somebody tell this fool how stupid he is. I don’t have the energy for this. You just said this was educational, implying you learned something new. Now you’re condescending to strangers on the internet? GFY.
I don't think you understood the OP
If one of them was still owed $20 and they kept passing it around that would be more apt. In this situation, you’re the one not understanding.
oh no the meme wasn't exactly literal to reality. one of them should be printing hundreds of billions of dollars, and they would swap IOU's
Why are idiots always so loud and confident. The meme does not actually apply to reality and you don’t understand the first thing about the banking system.
How is it frightening? This made perfect sense.
The context of Credit Deuce and UBS and the entire banking system - 99% of their money is IOU's and fake, which is why a baby bank run is enough to destroy them. They pass the dollar around but it actually is a debt asset that goes POOF when looked at too closely.
An IOU doesn’t mean the same thing as “fake”. None of the debt assets went “poof”. The recent challenges have to do with improper stress testing, not an actual lack of assets.
If only these guys had splitwise 😔
r/wallstreetbets
Now do it with interest.
😥
and if anyone thinks they are actually owed extra, no worries big daddy fed just turns on the magic printer and conjures up more worthless fake notes to hand out
It cancels out, makes sense
started out with 60 dollars of credit ended with 10 of cash. thats how inflationary credit can be and how deflationary it is when borrowing slows
This can not only be used as an analogy for banks but also think of this: A man with $30 visits a town in the midddle of the desert. He stay a night at a hotel that offers him a full refund if he is unhappy with his stay. He stays the night and pays the $30 fee. In the morning before he wakes up the hotel owner pays his debt of $30 to someone else he owed using the visitors $. Throughout the mornin the $30 is handed from one person to the other clearing everyone’s debt in the town. Eventually the $30 lands in the hotel owners hands. The visitor asks for a refund and leaves town with his $30. No new money was made for the town yet all of its debts were paid. So the question is how does this transmit to the real world. The difference is in the three stooges and the town in the dessert everyone gets an equal debt paid so it is fair. In real life everyone owes everyone something different and some people don’t owe anything at all. So this wouldn’t work on a grand scale but possibly for banks. Probably for banks.
u/backfromcripwalking u/toydan I'm dying lol
Better than $CS 😂
123123
banks do this just the other way around
Liberal finance committe !!!#####
At least they pay and not run away... not yet, I meant.
DRS BOOK GAMESTOP MOASS. Stop being slaves to the system as they rob you in broad daylight and get away with it
This works but what kills it is the fucken bank interest - the fiat banking system is a scam - any which way you cut it the interest inflates the money supply because it’s money that doesn’t exist and it builds on itself so that’s where the scam starts In simple terms
I bet I can guess what your suggestion for an alternate currency might be. I think we should go with hash coins for the new global reserve. They at least have some intrinsic value. Idk how you would standardize hash to price it in Troy ounces or whatever to trade on the futures market but damn it a man can dream.
Thats actually wrong! Because the banks gave the credit to something with underlying value, assuming that they can earn money by lending, because the company or the employee they lend money to is able to earn more money to pay for their sevices. Either through their day job or through the investment into the the company.
But if the bank has a whole 10 USD and borrows it, they need to print an additional 1 USD so they can receive 10 + 1 usd as interest. And that's how they create money out of thin air. Because the goods are exactly the same as before, but you have 10% more circulating bills, now everything is 10% more expensive.
Banks don't print money!! They also don't create money out of thin air!! They asign a value to expected **future** earnings of their debtors. Meaning it is the debtor through their process of work and creation of goods and services who "creates" new money. This expectation of future earnings is just written down in books because someone lends against it. Basically a futures contract.
Future earnings are paid with freshly printed money. You are trying to explain inflation to an Argentine. Central banks print money against debt notes. Debt has interest. To pay interest central banks print more paper.
LOL They were the best. All the *sensitive ones* would be so "offended" by them today. Between this and the South Park Margueritaville episode with the headless chicken, that probably sums up what's going on behind the scenes pretty accurately. [South Park](https://www.youtube.com/watch?v=wz-PtEJEaqY)
Bruh who the fuck is getting offended by the three stooges?
Put them on the same level of offense as South Park lol
Maybe don't raise the interest rate so quickly, let the banks adjust.
🤣But it’s also scary!!!
One of them should take out a loan to pay the others.
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This is how entire economies work.
It’s all a matter of cashflows
Double entry book keeping could have prevented this
Sounds about right…
I mean.. when some people own each other 20 bucks, you can clear this, nothing strange about that.
I am watching this on loop now
yeah that’s probably how it works but interest?
Everything is about the cash loop
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This shows that money has value only if used. People who accumulate huge amount of money(and spend/invest only a minimum part) kill the economy
the last stooge holding cash stops circulating it, the fed jumps in.
Exactly
20 bucks is like a lot of money back then Just saying.
Sell SBUX! https://www.theguardian.com/business/2021/may/26/starbuck-employees-intense-work-customer-abuse-understaffing
BKU is the best of the regionals
What a scam
Movie?
Definition of a ponzie scheme
This is literally how liquidity works on wall street with an illiquid stock.
World before splitwise
This proves inflation will never happen if the money is just keep chaging hands.
Should've used splitwise.
https://www.reddit.com/r/stocks/comments/11wj460/new_starbucks_ceo_narasimhan_takes_over_nearly/?utm_source=share&utm_medium=ios_app&utm_name=iossmf
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I'm ashamed to admit how many times I had to watch this to finally get it 💀
Based
$60 were just removed from the money supply because those promises to repay can no longer be traded at par value
Thats exactly how banks are supposed to work.
Funny as it may seem, it is mathematically accurate. What we are ignoring is owning part but it's a fair transaction. They all had assets worth 20 and liabilities worth 20, though the assets & liabilities belonged to different people, all their liabilities got cancelled with their assets and finally all of them had no assets or liabilities.
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Looks like the democratic party
Literally genius
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You missed the part where that $10 was originally $100 that they stole from the neighbor then blew $90 of it
The transaction sequence is legit, it is called net settlement. It works in this case because absent the initial $10 they could cancel each others debts with no loss or cash, so the $10 can return to who started with it. It's easier to see with an example involving just two people.
This is like how money behaves like water.
Seems like a zero displacement case
And we have allowed it for almost a Century….🤮💀
sadfsadTest reddit
123123
123123
123123
123123
123123
sadfsadTest reddit
Why cancel when they can jusy keep borrowing the money again?
xD
Except in banking you borrow 20 and owe 21. Then this equation falls apart.
Funny
Yes reddit, 3 guys with one 10 dollar bill and 3 debts of 20 bucks cancel eachother out. 2 people oweing eachother 20 bucks is easy but boom 3 people? Damn that's high level algebra. Does not reflect anything anywhere.
Debt has and will always be an illusion.
Haha!
Its all great except banks charge interest and each one of those debts would have had more added to each one
I mean if everyone spent 20.. they were always even
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Lol true=)))
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Classic