Then came the second Amsterdam discovery, although the principle was known elsewhere. Bank deposits...did not need to be left idly in the bank. They could be lent. The bank then got interest. The borrower then had a deposit that he could spend. But the original deposit still stood to the credit of the original depositor. That too could be spent. Money, spendable money, had been created. Let no one rub his or her eyes. It's still being done-every day. The creation of money by a bank is as simple as this, so simple, I've often said, that the mind is slightly repelled.
John Kenneth GalbraithThe ideas by which people . . . interpret their existence and in measure guide their behavior, were not forged in a world of wealth.
John Kenneth GalbraithI was in charge of price controls in World War II and had a ceiling on overall prices. Everybody who was subject to general maximum price regulation wanted an exception and went to Congress to persuade a Congressman, or a group of people on the Hill, that I was being a menace to their industry.
John Kenneth GalbraithIn numerous years following the war, the Federal Government ran a heavy surplus. It could not (however) pay off its debt, retire its securities, because to do so meant there would be no bonds to back the national bank notes. To pay off the debt was to destroy the money supply.
John Kenneth Galbraith