Comment Comment by simo7 It is to say that money is in principle something only quantitatively different from a loan.In fact, you can see money as a credit towards an extremely trustworthy debtor.So trustworthy that everybody will accept that credit on its face value in exchange for any sort of goods.What's the characteristic of a risky loan, it comes with a very high interest rate right?So what happened when the risk is the lowest possible? The interest rates goes to zero or even negative.That's money, a government-bond of a very stable country with little debt is quasi-money. The difference is only quantitative, makes sense? parent simo7 8 years ago
In fact, you can see money as a credit towards an extremely trustworthy debtor.
So trustworthy that everybody will accept that credit on its face value in exchange for any sort of goods.
What's the characteristic of a risky loan, it comes with a very high interest rate right?
So what happened when the risk is the lowest possible? The interest rates goes to zero or even negative.
That's money, a government-bond of a very stable country with little debt is quasi-money. The difference is only quantitative, makes sense?