Money creation

What is money? How is it created and by whom? Why do we say “loans make deposits”? What role does the central bank play and why isn’t money creation unlimited?

This short animated film briefly explains the money creation process that is part of our daily life and may appear so natural. 

Source: Banque de France – Cité de l’économie et de la monnaie

Objective: Understanding the concept of money and the money creation process. The film starts by explaining the concept of money, an asset based on trust within a community, before addressing the question of its creation by commercial banks via loans. It then presents the role of the central bank, guarantor of the stability of this system and of the trust placed in money.

Audience: 14+

Duration: 4’54


Published on 4 November 2015.