MONEY CREATION
AND THE
BASIC SHAPE OF THE ECONOMY
CENTRAL BANK
FEDERAL GOVERNMENT
OTHER COUNTRIES TYPE OF MEDIUM EXCHANGE
SPENDING USES money used to buy earth’s resources to produce goods, services and infrastructure
bonds
COMPANIES/INVESTORS
money
money used to support living standards and population growth
new money
loans
I
grants loans
loan repay savings
PROVINCIAL/STATE/MUNICIPAL GOVERNMENTS grants investments
I
PRIVATE BANKS loans leftover funds returned to bank
*
debt repaid with interest
> bankruptcy > asset liquidation
loans
I
purchases investments donations loans I
* **
grants loans
COMPANIES/INSTITUTIONS/NGOs
income employment
money interest
Businesses gain a great deal of their profits from working with other businesses (B2B), not just through the public and the government. This loan repayment process is mostly the same of all loans.
welfare grants loans
I
type of medium exchange
PEOPLE NO
**
YES can the entity repay the loan?
purchases investments donations loans
OTHER
direction of flow tax
I
grants loans spending use