Book of macro economic theories.
Origin of Book: 2008
Central Tenets: Current Theory does not acknowledge banks are the money creators.
1. Current theory: Banks are financial intermediary.
2. Money supply: money in packet + deposits
3. Loan only creates deposits.
4. Loan is a asset in Bank and deposit is a liability in bank.
5. 90℅ of money is created by giving loans
Practical Application in India:
1. Private credit to GDP ratio South Korea vs India. India fell behind.
It impacted gdp per capita.
2. Lending the money at affordable rate is failure for India
3. We have not given credit enough people who are deserving people.
4. 1 in 7 has bank loan
5. What kind of capacity rise will
If bank credit grows 15℅ gdp grows 10℅
Don't give it to dubious loan seekers.
6. Manufacturing and export rely on Credit
7. Lending tech and tracking technology should help credit growth
8 Indian banking system has not delivered so far.
9. Central banks role in money supply, by bank reserve.. Does not work. Money multiple does not work.
10. 2019 to 2023. Inflation 2 to 3 times historically inflation in other countries. Inflation is lot of money chasing too fewer goods.
11. Money supply equation.
12. Government spending is also important.
13.

Book of macro economic theories.

Origin of Book: 2008

Central Tenets: Current Theory does not acknowledge banks are the money creators.

1\. Current theory: Banks are financial intermediary.

2\. Money supply: money in packet + deposits

3\. Loan only creates deposits.

4\. Loan is a asset in Bank and deposit is a liability in bank.

5\. 90℅ of money is created by giving loans

Practical Application in India:

1\. Private credit to GDP ratio South Korea vs India. India fell behind.

It impacted gdp per capita.

2\. Lending the money at affordable rate is failure for India

3\. We have not given credit enough people who are deserving people.

4\. 1 in 7 has bank loan

5\. What kind of capacity rise will

If bank credit grows 15℅ gdp grows 10℅

Don't give it to dubious loan seekers.

6\. Manufacturing and export rely on Credit

7\. Lending tech and tracking technology should help credit growth

8 Indian banking system has not delivered so far.

9\. Central banks role in money supply, by bank reserve.. Does not work. Money multiple does not work.

10\. 2019 to 2023. Inflation 2 to 3 times historically inflation in other countries. Inflation is lot of money chasing too fewer goods.

11\. Money supply equation.

12\. Government spending is also important.

13.

Money: a zero sum Game - Krishnamurthy Subramanian