That’s actually crazy because in a capitalist banking system those funds are ideally reinvested into production via loans to firms. Although this is only because a reserve requirement is in place to limit how much can be lent vs how much there is in deposits.
That’s actually crazy because in a capitalist banking system those funds are ideally reinvested into production via loans to firms. Although this is only because a reserve requirement is in place to limit how much can be lent vs how much there is in deposits.