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Banks don't lend required reserves, but they can lend excess reserves if they want. That's why they're called "excess" reserves. Clearly this stuff is too complex for you.

 

They lend excess reserves to other banks in the interbank market. They do not lend excess reserves to the non-banking sector. This stuff is way way too complex for you.

 

They can lend it to whoever they want. You are just full of crap. First, you said they don't lend them, period. Now, you say they can lend them to other banks. Next, you will probably admit what I've been saying all along, that excess reserves can be loaned out to other banks and non-bank entities. There is nothing stopping them from doing that except market conditions. You are just making things up and then moving the goalposts when you're proven wrong. Nobody on this forum should take you seriously. You don't have the first clue what you're talking about.

 

No they cannot. They create deposits and loans. They do not lend you excess reserves. You have very amateur knowledge of how things work. It wouldn't surprise me if you also think you understand the banking system, lol. Trust me, I know more about money and banking and the Fed than anyone on this site. Especially you.

 

yes i do, it's money

 

No, akphidelt is wrong, as usual. He just spouts whatever self-serving nonsense that pops into his head and hopes that no one will challenge him on it, but when his BS is pointed out, he creates strawmen and moves the goalposts in order to maintain his fantasy. Here we can see the inconsistencies in and "evolution" of his position...

Says the fed is not injecting money into the "economy":

Then tries to move the goalposts:

Says banks don't lend reserves:

Then tries to move the goalposts:

This is always the case with him. He makes a claim that isn't true and when it's pointed out tries salvage it by moving the goalposts (while hurling insults and creating strawmen). You would have to be real gullible to listen to this guy, Pollycy. He's just your standard apologist for the fed who wants you to get bogged down in minutia so you miss the bigger picture.

 

You assert that banks cannot lend their excess reserves to non-bank entities. Please provide evidence that this is the case by citing a law or a Fed regulation that says banks cannot lend their excess reserves to non-bank entities.

Your expertise is totally imagined. Your Econ professor must have been quite the fool.

 

It's a type of money that is made of METAL. USD are made of PAPER. Do I need to explain the difference between METAL and PAPER to you?

 

And here is definitive proof that akphidelt is completely full of crap and will just make claims with no idea if they're true or not...

While banks cannot control the overall level of excess reserves, there are a several ways they can reduce the level of excess reserves on their own individual balance sheets. They can lend excess reserves to other banks in the federal funds market, they can lend them to consumers or businesses, or they can purchase securities.

From the Cleveland Fed: http://www.clevelandfed.org/research/trends/2011/0511/01finmar.cfm

Please stop acting like you are some kind of expert on how the fed operates. You are completely full of it.

 

That's not just what I say. Ben Bernanke says it also.

Now, what these reserves are is essentially deposits that commercial banks hold with the Fed, so sometimes you hear the Fed is printing money, that’s not really happening, the amount of cash in circulation is not changing. What’s happening is that banks are holding more and more reserves with the Fed.

I guess you know more than both of us. Should probably write a letter to Ben telling him your astute findings. Lol, what a clown you are.

Banks don't lend reserves. They create deposits and loans.

It's as true as it gets. You are not really the most credible person in the world to be critiquing my knowledge, lol. Very embarrassing.

 

Still clinging to your money printing strawman? Yes, very embarrassing.

 

Lol, they don't lend excess reserves. They simply create deposits and loans. Reserves do not leave the banking system.

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What's the strawman about it? Lol

 

They can lend excess reserves to other banks in the federal funds market, they can lend them to consumers or businesses, or they can purchase securities.

http://www.clevelandfed.org/research/trends/2011/0511/01finmar.cfm

 

You say "lol" more than a teenage girl texting her BFF. Grow up, kid.

It's a strawman because I never said anything about printing money.

Any other stupid questions?

 

That's not accurate at all. Unless they are simply implying the transfer of excess reserves to required reserves as "lending". But they definitely do not lend reserves to you or I. We get deposits. Go to your bank and ask them to lend you some reserves, they will have no clue what you are talking about, lol. You really don't know how the banking system works.

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So if they are not printing money, they are not adding money in to circulation, then what is your argument, lol.

 

It's pretty simple to understand that banks don't lend reserves. This is where the traditional lending happens, which I'm sure this is all they are referring to. Even though in reality banks do not lend reserves. This is all based on the myth that we have a fractional reserve banking system that is effected by reserve balances.

A | L
Req Reserves $100 | Deposits $1000
Exc Reserves $900

This is the typical example that you see in high school textbooks. Now, what they are saying is the next process is "lending out excess reserves". Which, technically is incorrect, because you don't get excess reserves, you get a deposit and they get a loan. So if they loan out $1000, it goes

A | L
Req Reserves $200 | Deposits $2000
Exc Reserves $800
Loans $1000

They didn't lose a single reserve. It's simply some excess reserves became required reserves.

Like I said, you don't know much of what you are talking about.

 

I guess the forum community will just have to decide for themselves who is more knowledgeable about the Federal Reserve's monetary policy - you or the Senior Economic Advisor at the Cleveland Fed...

LOL

 

Like I said, they are referring to textbook money multiplier in that excess reserves can be lent 1/rr times. Banks don't actually lend excess reserves to people. They create loans and deposits.

 

what a joke, it's money

 

Do you need me to explain the difference between METAL and PAPER? Yes or no?

 

again with the jokes

 

This is not a joke. You apparently don't know what a coin is. I'll give you a hint, it's not made out of paper.

 

sure it is

 

For those of you following Ethereal thinks he caught me by providing a link by the Cleveland Fed that says banks can "lend" excess reserves to customers.

This goes right along with the money multiplier myth that the Fed themselves have admitted. That if you give banks "x" amount of excess reserves they can lend them out 1/rr. So when they say banks can lend out excess reserves, what they really mean is banks can leverage excess reserves based on this multiplier.

You have to go in to high level money and banking to understand the difference.

Ethereal of course will take this at face value and with out actually understand it claim that banks lend excess reserves. When in fact they do not lend reserves at all.

 

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