Coinucopia’s thriving banking sector
Debunking Economics - the podcast
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Unraveling Banking Myths in Coinucopia
This chapter examines the crucial yet often misunderstood role of banks in creating money through lending, using the fictional island of Coinucopia to illustrate key concepts. It discusses the implications of fractional reserve banking, the management of assets and liabilities, and the evolutionary practices of banks that expand the money supply. Additionally, it touches on the risks associated with banking practices, including the potential for bank runs and issues surrounding credit.
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