Vollgeld 101 The Future of Money - Conference Manuel Klein Quotes - - PowerPoint PPT Presentation

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Vollgeld 101 The Future of Money - Conference Manuel Klein Quotes - - PowerPoint PPT Presentation

Sep 10, 2022 27 likes •267 views

Vollgeld 101 The Future of Money - Conference Manuel Klein Quotes from central bank publications Money creation in practice differs from some popular misconceptions banks do not act simply as intermediaries, lending out deposits that

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Vollgeld 101

The Future of Money - Conference Manuel Klein

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Quotes from central bank publications

  • “Money creation in practice differs from some popular misconceptions — banks do not act

simply as intermediaries, lending out deposits that savers place with them, and nor do they multiply up central bank money to create new loans and deposits. Whenever a bank makes a loan, it simultaneously creates a matching deposit in the borrower’s bank account, thereby creating new money.”

  • McLeay, M., Radia, A.,and Thomas, R. (2014) Money creation in the modern economy,

Bank of England Quarterly Bulletin 2014 Q1

  • „Tatsächlich wird bei der Kreditvergabe durch eine Bank stets zusätzliches Buchgeld
  • geschaffen. Die weitverbreitete Vorstellung, dass eine Bank "auch altes, schon früher

geschöpftes Buchgeld, z.B. Spareinlagen, weiterreichen" (könne), wodurch die volkswirtschaftliche Geldmenge nicht erhöht wird, trifft nicht zu.“

  • Vertiefung: FAQ zum Thema Geldschöpfung – Website der Bundesbank
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Two different money circles

Money is created when banks create loans and when they buy assets

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Money creation = Balance sheet lengthening

Activa Passiva Reserves 16 200 200 Deposits Loans 800 800 750 Other liabilities Other assets 184 50 Equity 1.000 1.000 Activa Passiva Reserves 16 205 205 Deposits Loans 805 805 750 Other liabilities Other assets 184 50 Equity 1.00 1.005 1.00 1.005

Aufteilung basierend auf Bundesbankdaten 2000-2015

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Vortrag Lehrstuhl BWL V, Manuel Klein

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Money creation = Balance sheet lengthening

Aktiva Passiva Reserves 16 200 200 Deposits Loans 800 750 Other liabilities Other assets 184 184 50 Equity 1.000 1.000 Aktiva Passiva Reserves 16 205 205 Deposits Loans 800 750 Other liabilities Other assets 189 189 50 Equity 1.00 1.005 1.00 1.005

Aufteilung basierend auf Bundesbankdaten 2000-2015

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Money is created when banks create loans and when they buy assets Money is created when banks create loans and when they buy assets Money is created they buy assets Money is created they buy assets

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Ideal case

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Source: Youtube: Could These 3 Simple Changes to Banking Fix the Economy? – Positive Money

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Money creation

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(Asset price) Inflation

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Source: Greenham et al. (2012): Where does money come from, S.52

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Source: Koo, R. C. (2013): Balance Sheet Recession as the Other-Half of Macroeconomics, S.26

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Money reduction

Money is destroyed when loans are repaid

  • r assets are sold
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Money reduction

Money supply ≈ net position between loan issues and repayments

Money is destroyed when loans are repaid

  • r assets are sold
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Quantitative Easing

QE Money supply in the real economy is not stimulated by QE

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Quelle: Koo, R. C. (2013): Balance Sheet Recession as the Other-Half of Macroeconomics, S.24

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Peoples‘ Quantitative Easing / Digital Cash

QE Digital Cash

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Vollgeld as a solution?

Vollgeld is only Issued by the Central bank or a public monetary authority Banks become pure intermediaries

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Implications

  • Elimination of Bank-Runs
  • Safe money and method of payment – also in crises
  • Banks can go bust
  • Dramatic reduction of government and private debt through

the one time seigniorage

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Drastic government debt reduction

Government debt 2011 in Billions in % GDP M1: Vollgeld in Bill. Government debt after the change Remaining debt in % of GDP Belgium 361 98 168 193 52 Germnay 2.088 81 1.314 774 30 France 1.717 86 987 730 37 Greece 280 132 136 144 68 Ireland 169 108 77 92 59 Italy 1.897 120 867 1.030 65 Austria 217 72 135 82 27 Portugal 184 108 121 63 37 Switzerland 205 35 268 Spain 734 68 576 158 15

Source: Mayer, T. und R. Huber (2014): Vollgeld - Das Geldsystem der Zukunft

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Soucre: Youtube-Video: How The Economic Machine Works by Ray Dalio http://www.economist.com/node/5381959

Better control of credit cycles and inflation

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Evolvement of the Vollgeld Movement

05.08.2016: Primeminister of Island (Sigurður Jóhannsson) and KPMG Island

  • rganize a conference about Vollgeld in Iceland.

Source: Money Issuance (2016) KPMG Island

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Referendum about the implementation of a Vollgeld-System in 2018

~25 % said Yes – it has been a big step forward for the discussion about the money system

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