Endogenous money

Endogenous money,

Definition of Endogenous money:

  1. Theory that money exists just as its needed by the economy, because bank system reserves are increased or decreased to accommodate for demand. Under the endogenous money theory, if banks can borrow money at the Federal Reserve discount rate and still lend money profitably, then the money available for banks to borrow will become available as necessary to support the level of consumer lending individual banks require.

Meaning of Endogenous money & Endogenous money Definition