Understanding Money Creation Today

First: No, there aren’t 14 computers printing money out of thin

air. Here’s how it really works, quick version: When you go to a

bank and take out a $10,000 loan, the bank doesn’t hand you money from a vault.

They create a $10,000 deposit in your account and record the loan as an asset. You owe them 10k,

they owe you 10k — it nets to zero. That’s how most money in the economy is created.

Now the government side: Congress approves spending → The U.S.

Treasury sends the money → That money comes from taxes. But if taxes don’t

cover it? That’s called a deficit, and the Treasury sells bonds to investors