Hi Krisgonquist,

I'm sorry I wasn't able to adequately address your question. Your accounting expertise definitely exceeds mine, so I will defer to you on this point!

Any sensible and intelligent person would be challenged to wrap their minds around our flawed banking system. It's unnecessarily complex and difficult to grok -- and as John Kenneth Galbraith observed, I think this is by design. I've learned in my profession (as a lawyer) that complexity is often used to hide chicanery and corruption. The devil, as they say, is always in the details.

Regardless of the way these debits and credits are logged in banking ledgers, the important take away is -- as you said -- our money is not backed up by an equal amount of goods. When too much money is chasing too few goods, we end up in the place we find ourselves now.