Think outside the box




世界経済は弱さ蔓延、収支気にせず財政出動を=クルーグマン教授 | ロイター

BRIEF-内閣府幹部:クルーグマン教授「長期的に日本の財政心配、2─3年は収支気にせず出動すべき」 | ロイター





First of all, any individual bank does, in fact, have to lend out the money it receives in deposits. Bank loan officers can’t just issue checks out of thin air; like employees of any financial intermediary, they must buy assets with funds they have on hand.*1

… a key limiting factor in the size of bank balance sheets is the amount of monetary base the Fed creates — even if banks hold no reserves.


しかし、イングランド銀行が2014年3月の四季報に掲載した"Money creation in the modern economy"では、クルーグマンとは異なる説明がされています。

Money creation in the modern economy

When a bank makes a loan, for example to someone taking out a mortgage to buy a house, it does not typically do so by giving them thousands of pounds worth of banknotes. Instead, it credits their bank account with a bank deposit of the size of the mortgage. At that moment, new money is created. For this reason, some economists have referred to bank deposits as ‘fountain pen money’, created at the stroke of bankers’ pens when they approve loans.

The supply of both reserves and currency (which together make up base money) is determined by banks’ demand for reserves both for the settlement of payments and to meet demand for currency from their customers — demand that the central bank typically accommodates. This demand for base money is therefore more likely to be a consequence rather than a cause of banks making loans and creating broad money.


OK, color me puzzled. I’ve seen a number of people touting this Bank of England paper (pdf) on how banks create money as offering some kind of radical new way of looking at the economy. And it is a good piece. But it doesn’t seem, in any important way, to be at odds with what Tobin wrote 50 years ago (pdf) — indeed, the BoE paper cites Tobin extensively. And I have always thought of money in Tobinesque terms, even if I sometimes use shorthand descriptions that can be misread if you take them out of context; the same is true of many economists.