Finance & Investing · Banking & Financial Institutions
A topic within Banking & Financial Institutions, itself one of 11 topics in that field and part of Finance & Investing.
2 works
Federal Reserve Bank of Chicago
Walks through, step by step, how one new bank deposit expands into a multiple of new deposits across the banking system as each bank relends a fraction of what it receives, making commercial bank money creation mechanical rather than mysterious.
Douglas W. Diamond
Explains why banks exist at all: they let many small savers delegate the costly job of monitoring borrowers to one institution, which can do it more cheaply than each saver monitoring directly, so long as the bank itself is disciplined by holding a diversified loan portfolio.