Money Creation


Money makes the world go round! Therefore we must understand how it works, in order to attract it, keep it and make it work for us.
We are taught that the amount of money created in an economy depends on the monetary policy of the central bank. The monetary policy varies from setting the interest rate, printing notes, or even through purchasing assets or quantitative easing. Whichever way it’s created, money eventually ends up in the hands of the people through banks.
Banks are then required to hold a certain portion as reverses and they tend to loan the rest. This simultaneously creates a matching deposit in the borrower’s bank account, thereby creating new money. This money then circulates in the economy and eventually lands in your hands.
The big question is how do you claim your piece of the pie and retain that money in your pocket?

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