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Comment by mucle6 | Hacker News Reader

Not trying to be pedantic, just curious.

Money isn't zero sum right? Like the U.S. Government prints it and spends it, so its not clear to me that there is a balance sheet of cash being someone elses debt. Unless its in a metaphorical sense like we're all in "debt" to the U.S government and we pay interest when they inflate more money.

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The government creates money by spending, but most money is actually created by commercial banks when people take out loans. ALL money is accounted for in these ledgers. So consequently, most money in people's deposit accounts is debt, either their own or someone else's.

I recommend reading the Bank of England's Money Creation in the Modern Economy

https://www.bankofengland.co.uk/quarterly-bulletin/2014/q1/m...

Money isn't zero sum, but its value is based on being able to exchange it for goods and services - or to compel the production of goods and the carrying out of services. The less debt exists, the less compelled people are to work.

> Like the U.S. Government prints it and spends it, so its not clear to me that there is a balance sheet of cash being someone elses debt.

The US government prints it (“quantitative easing") by creating new money and buying its own debt. In this sense it’s still correct to say this Government printed money is backed by debt.

Nb. That this is only a small proportion of the overall money supply though. Commercial bank deposits (created through bank lending) represent the vast majority.

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