The money multiplier theory is one of the biggest myths in economics. Many textbooks claim that banks lend out a fraction of deposits, multiplying money through fractional reserve banking. But modern ...

The terms "deposit multiplier" and "money multiplier" are often confused and used interchangeably because they are very closely related concepts and the distinction between them can be difficult ...

The following comes from an excellent new paper from the Fed. The paper describes the myth of the money multiplier and is an absolute must read for anyone who is trying to fully understand the ...

was £468 now £279 for your first year Make up your own mind. Build robust opinions on the FT's trusted journalism. Offer available until 27 February 2025.