- Explain exactly how finance companies play the role of intermediaries anywhere between savers and you will consumers
- Measure the matchmaking ranging from finance companies, savings and you may loans, and you may credit unions
- Get acquainted with what is causing bankruptcy proceeding and you can recessions
The fresh late bank robber titled Willie Sutton was once questioned why the guy robbed banking institutions. The guy responded: “That’s where the cash is actually.” Although this was true at a time, regarding perspective of modern economists, Sutton is actually best and you will completely wrong. He is completely wrong because daunting almost all money in the fresh new discount isn’t in the way of currency resting from inside the vaults otherwise compartments on banking companies, waiting for a beneficial robber to seem. Very cash is when it comes to bank accounts, that you can get simply while the digital info towards the computers. Off a bigger angle, yet not, the lending company robber is significantly more correct than simply he may keeps identified. Banking are sexually interconnected that have money and therefore, with the bigger benefit.