Money sitting in accounts making interest does not contribute to GDP.
What I have sitting in my bank account that I’m getting interest payments for is not money but stocks. I’ve spent that money to buy those stocks. That money has been back in the circulation this whole time.
The interest does not come from lending the money. Heck, the DEBT doesn’t even come from lending the money. Banks can basically create money to loan with out of thin air thanks to fractional reserve banking.
Seems like the headline is just another way to say the same.
At the same time USA is one of the richest countries in the world?
Richest by GDP. And extracting all the wages they pay us is the optimal way to maximize GDP.
Money sitting in accounts making interest does not contribute to GDP.
What I have sitting in my bank account that I’m getting interest payments for is not money but stocks. I’ve spent that money to buy those stocks. That money has been back in the circulation this whole time.
Doesn’t the interest come from lending out the money?
The interest does not come from lending the money. Heck, the DEBT doesn’t even come from lending the money. Banks can basically create money to loan with out of thin air thanks to fractional reserve banking.