Banks Create Money To Facilitate Transactions - Example
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Summary:
- the rich person paid for a meal with ingredients and some gold
- the poor person got paid to make a meal
- the bank got paid to facilitate the transaction
Alternatives to avoid the bank loan:
- EITHER the poor person already has the gold to buy the ingredients from the beginning
- OR the poor person convinces the rich person from the beginning
- OR the ingredients don’t get converted to a more valuable meal
