ANOTHER asset? John R.
>From: Timothy Carpenter <timbeau_hk@yahoo.co.uk>
>Reply-To: socialcredit@elistas.com >To: <socialcredit@elistas.com> >Subject:
Re: [socialcredit] Reply to Jessop addendum >Date: Tue, 03 May 2005 08:13:04
+0100 > >Dear John, > >Which is fine, because I never said that. > >It could be
another asset that permits the bank to lend, depending on the >conditions in its
banking license. In the UK and in many countries a bank >uses a risk and
liquidity rated range of assets, higher risk and/or >liquidity means lower
lending ratios against that asset. > >Tim > >On 2/5/05 10:33 pm, "John G Rawson"
<johngrawson@hotmail.com> wrote: > > > To "butt in", deposits have nothing to do
with "allowing loans".
Deposits are > > bank liabilities. > > > > John R. > >> >From: Timothy Carpenter
<timbeau_hk@yahoo.co.uk> >Reply-To: > >> socialcredit@elistas.com >To:
<socialcredit@elistas.com> >Subject: Re: > >> [socialcredit] Reply to Jessop
addendum >Date: Mon, 02 May 2005 21:19:25 > >> +0100 > >Dear Joe, > >My
understanding is that, using your example, the $1000 > >> deposit would permit
>the bank, within its remit and licence, to issue loans > >> of $5000 in total
and >charge 5% on it. The depositor would see 2.5% of > >> $1000. That $5000 does
not >come from deposits, but is created on paper. > >> Rarely are loans withdrawn
as >legal tender so the issue of vault cash seldom > >> comes into it, hence the
>reserve ratios! > >These days loans
are weighted by > >> risk, not just a %age, so a loan on a house >is secured and
allows more > >> lending, while a loan on a car is not really >(could crash but
will > >> depreciate) and has higher risk. > >Tim > >On 2/5/05 4:31 pm, "Joe
Thomson" > >> <thomsonhiyu@shaw.ca> wrote: > > > I should add, before anyone gets
the > >> impression that my previous reply to > > Jessop is concentrating on the
> >> sideline of 'interest', that the important > > point to be taken is that >
>> LOANS CREATE DEPOSITS. > > > > Joe > > > >>
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