Federal Reserve: Money Creation

Federal Reserve: Money Creation

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Storyboard Description

The process of monetary creation after I have receive a gift of 1,000 dollars and how that money is later used.

Storyboard Text

  • me
  • mom
  • You can easily deposit and withdraw money with your bank and much more through your smartphone, anywhere as long as you made an account with them
  • Loans
  • Reserved
  • The initial $1,000 dollars is first given as a gift to me from my mother
  • Jane
  • Banker
  • I deposit my newly acquired $1,000 dollars into my checking account where my money will be kept safe in place and for me to use the money where ever I want.
  • David
  • The bank now uses the $1,000 dollars from my checking account to hold $100 in the reserves and the other $900 available for loans for other people to acquire.
  • Note* Money is also safely transferred over between others, not just banks, through your smartphones.
  • The money I had safely placed in the bank is now loaned to Jane using the system of reserve and loans, she also now holds a loan of $900 dollars she didn't have before and new money created since my money is still in the bank.
  • She uses her loan of $900 dollars to pay her friend, David for his machine. David now has a new $900 dollars with him.
  • He deposits those new $900 dollars to another bank where it takes the split of $810 dollars given for loans and $90 dollars in the reserve but he still retains $900 dollars.
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