Question #26

The Australian (or US, for that matter) government's net spending is

• unique because the Government can always pay for goods and services by crediting bank accounts.
• unique because spending derived from private credit creation cannot add to the private sector's net worth.
• similar in impact to money created by commercial bank credit creation.

Answer #216

Answer: unique because spending derived from private credit creation cannot add to the private sector's net worth.

Explanation

Please see Money multiplier and other myths or post a question via the comments page.