Imagine a banking system where the public would lend money to the Treasury at X% interest, and the Treasury would then lend the same funds to commercial banks at the same X% interest rate. All bank deposits were held by the Treasury.
Imagine a banking system where the public would lend money to the Treasury at X% interest, and the Treasury would then lend the same funds to commercial banks at the same X% interest rate. All bank deposits were held by the Treasury.