Did you know commercial banks create money from nothing?

[upepo]

@ndume

You statement is extremely ignorant for any response, educate yourself

You could also be ignorant for expecting basic civilians to grasp such complex concepts. If the public understood how money works, there would be riots in every corner of the globe. Money creation is the biggest crime against humanity in our present world.

[Stormtrooper98]

Interesting topic. Niliona kuna watu US who convert their money into silver and alcohol. Apparently those 2 things maintain their value even in an apocalypse.

[Trojanex]

@Rene Descartes

Finally, an example is when I have three customers and 10,000 shillings in cash. I can loan each of them 10,000 shillings and get paid interest for each loan as long as the loan appears as numbers in my register. Whenever one of them makes a withdrawal, he/she likely deposits in the other’s account. I always have 10,000 shillings in cash. most of the times, I don’t need to give out the hard paper money for a transaction, but just modify numbers in their accounts. If you were to add up numbers, you would think I have 30,000 shillings, which I have given out as loan, but this is categorically false. if they all withdrew cash I would be caught and system would collapse because of lack of confidence. a bank can only fulfill a small fraction of withdrawal obligations at a time.
Its a questionable system, but it works for now.

Just tell them (those not understanding) to figure out how M-Pesa works. What actually happens when you send someone money over M-Pesa? Its just numbers in layman language

[anon46421834]

@uwesmake

:D:D:D:D:D PAR yangu iko 15% banaaaa hata wasapere wanasumbua kulipa loan, but we are slow on auctioning. NPAs zimekuwa tricky provisions ndio zinafanyika . wanachi hawana kakitu

Hesabu ma noti za Enigma pole pole bila kusumbua kijiji you itchy assed bukusu.

[Oxygen]

@uwesmake

:D:D:D:D:D PAR yangu iko 15% banaaaa hata wasapere wanasumbua kulipa loan, but we are slow on auctioning. NPAs zimekuwa tricky provisions ndio zinafanyika . wanachi hawana kakitu

Hii language mbogi ya malanye wataelewa kweli Anko?wanajua DFBLHKM but PAR ni greek jargon:D:D

[mbwakali]

@ndume

When you walk into a bank to get a loan, the bank creates brand new money to lend to you. The debt to you then becomes an asset to the bank and you pay with interest. Banks therefore derive profits by creating money from nothing. The more debts the banks create, the more the profits, the more tax paid to government and hence the higher the economic growth. About 97% of money is created this way.

I think there will be an implosion of world’s fiat currency in the near future because US federal reserve is ‘‘printing’’ massive amount of dollars thereby diluting the value of the money we have because dollar is the reserve currency. Store some of your wealth in properties and just a fraction in cash forms (cash, bonds, bills)

Nobody cares about this ish. Since covid started it’s even worse .[ATTACH=full]368633[/ATTACH]

[Sio_Leo]

@Simiyu22

Can they lend ksh 500,000 to 500 mama mboga.
So what if some can’t repay. According to your theory, they can just recover by creating money out of thin air by shuffling paper.

Malisa yeye! Yani anamaanisha that anyone can start a commercial bank and start lending no-existent money to borrowers. Instresting times.

[Sio_Leo]

@mbwakali

Nobody cares about this ish. Since covid started it’s even worse .[ATTACH=full]368633[/ATTACH]

This is in a bid to control liquidity.

[mbwakali]

@Sio Leo

This is in a bid to control liquidity.

Hii sielewi bado ,they’ve printed 60% of all dollars in existence in 2020 alone.

[Dyson]

Only the Federal Reserve in the US does this and they do this expecting future growth and the stability of the US economy, countries like Kenya can’t afford to get away with such. Private banks in the US depend on the regulations and virtual cash reserves that the Federal Reserve has put in place, so your claim is a little bit off.

[LongerTime]

@uwesmake

:D:D:D:D:D PAR yangu iko 15% banaaaa hata wasapere wanasumbua kulipa loan, but we are slow on auctioning. NPAs zimekuwa tricky provisions ndio zinafanyika . wanachi hawana kakitu

Niko na katoto kanatafuta internship. Kamemaliza economics and finance just last month. Mko na internship opportunities huko kwenu?

[majizee]

How does Mpesa work?