There is a very long list of things that the banks do not tell us before they accept our money.
The following videos will give you a deep insight into what the banking industry actually represents.
If you really want to understand what is going on in our global society and why we advocate DeFi as necessary for all to be involved in, please take the time to watch the videos.
Where Does Money Come From?
The following video is a real eye-opener! Money is NOT created the way most people think.
Professor Richard Werner, an economist explained how banks create actually create money.
Professor Richard Werner’s landmark empirical study on money creation (2014) directly tested how new money is created inside a modern banking system.
By borrowing money from a real bank and tracing the accounting entries, he demonstrated that commercial banks do not lend out existing deposits or reserves. Instead, they create new money “out of nothing” at the moment a loan is issued, simply by crediting the borrower’s account.
This experimentally confirmed Werner’s long-standing theory that banks are the primary creators of money, not the central bank.
The validity of Werner’s findings was formally confirmed by the Bank of England in its 2014 Quarterly Bulletin, authored by Michael McLeay, Amar Radia, and Ryland Thomas of the Bank’s Monetary Analysis Directorate.
Their paper stated explicitly that “loans create deposits”, aligning fully with Werner’s experimental result and overturning the traditional textbook model that banks merely recycle savings.
This confirmation marked a major shift in how official institutions publicly describe money creation.
What Problems Arise From This Creation Process?
Many critics argue it resembles a form of systemic deception in how it’s publicly misunderstood. Here’s the clean breakdown:
Legally:
Bank money creation is fully authorized by law and regulation in nearly every modern economy. When a bank issues a loan and creates a matching deposit, it is operating within its banking license, under capital rules, reserve frameworks, and central-bank oversight. Because this process is explicitly permitted, it does not meet the legal definition of fraud, which requires intentional deception for unlawful gain. The courts, regulators, and central banks all recognize this mechanism as lawful.
Ethically and politically (where the controversy lies):
Many economists, reformers, and campaigners argue it feels like fraud to the public because:
- Most people are taught that banks “lend out savings,” which is factually incorrect.
- Banks earn interest on money they did not previously possess.
- The public bears the cost of financial crises, while private banks collect the profits during expansion.
So while the system is not legally fraudulent, critics argue it creates a moral hazard, enables asset bubbles, fuels inequality, and operates with a major transparency gap between how money actually works and how it is commonly taught.