If I take out a loan from the bank for €400,000, this money is not taken from any existing account, but created. Only when I repay the money is it put into circulation....
Half-knowledge is sometimes more dangerous than knowing that you know nothing. CORRECT is that commercial banks can create loans without first having to receive deposits. PARTIALLY CORRECT is that they wouldn't need deposits at all: they must attract them because they have to refinance negative balances in the inflows/outflows of customer deposits. And this with assets or central bank money, which they CANNOT create themselves. WRONG is that money comes into circulation when you repay a loan. It comes into circulation when you use the loan, for example, to pay the bills of craftsmen. When repaying, it is destroyed again. The bank has to cover, secure itself again, etc., in lending operations with the interest. What must be understood is that we have a two-tier monetary system. Banks cannot settle payments between each other, with the central bank or towards the state using self-created loans. Therefore, they can indeed become insolvent. For this kind of transaction, they need a means of payment that they cannot create themselves. Among other things, they earn money by creating means of payment "out of nothing" (which is not entirely true, there are regulations) for private individuals. If you find something stupid, then please do so because you have understood it. You could still buy a house if you really want to.
