Bank of England talks about money creation for the first time

Jay Owen Reforming Global Finance, SRI/ESG News

We have some seriously big news to announce! 

1) Huge milestone in our campaign

When we launched the Positive Money campaign 3 and half years ago and started talking about the fact that banks create money, we were faced with disbelief and shock. A common response was: ‘I don’t believe you. I think you just made that up.’ We had to spend a lot of time and energy to convince people that this is the way the system works.

At that time there was no official document by the Bank of England describing how the money system really works and serious factual misinformation in economics textbooks.

That was a time when we could only dream of these kind of tweets from the Bank of England:

YES, it looks like it was copied from the Positive Money website… and NO, this is not a spoof …These are real tweets from the real Bank of England’s twitter account!

Now, after 3 and half years of hard work, after we teamed up with the New Economics Foundation and wrote “Where Does Money Come From?” in order to have something to back our arguments, now – at last – the Bank of England has released official papers explaining that money is created by commercial banks! And there’s even an official video about it!

Find out more here

The Bank of England is the first major central bank in the world – that we know of – to publish something as clear and explicit as this. 

This means a huge milestone in our campaign for a just and fair money system. Finally, there’s a simple video and a paper to send to all those economists, academics, politicians and anyone shaking their head in disbelief! It should reduce drastically the time wasted in persuading people of all types to accept our analysis of the problems. 

We’d like to say a BIG Thank you to all of you who helped us to get to this point!


2) Positive Money’s Chief Economist leaves now that Bank of England knows where money comes from…

In March 2011, Andrew Jackson joined our team and has led our research ever since. He co-authored the books “Where Does Money Come From?” andModernising Money and several Positive Money publications

Andrew is now starting a full-time PhD with the highly regarded Professor Tim Jackson (author of Prosperity without Growth) and will be stepping back from work with Positive Money.

In a strange coincidence, on Andrew’s last day in the office, the Bank of England published the new paper mentioned above explaining exactly how money is created in the modern banking system. The paper actually references “Where Does Money Come From?”, the first book that Andrew worked on. That’s a great finish to 3 years of hard work to educate people about the reality of money!


3) Upcoming Events

Bristol, Wed 19th March – Positive Money Meetup

London, Thu 20th March – Canary Wharf Tour

London, Fri 21st March – Conference “Towards a sustainable financial system” – LSE

London, Fri 21st March – Loconomics Workshop 3 – London

Leicester, Sat 22nd March – Money: Impacts, Perceptions, Actions – Workshop

Manchester, Sat 22nd March – Conference “Age of Austerity – What can you do” (with Ben Dyson)

London, Mon 24th March – Economics Burlesque: Money – Do we need it? 

London, Fri 28th March – Loconomics Workshop 4 – London

Sheffield, Mon 31st March – “The Bank of England’s Mission, and the Positive Money proposals”

London – Lambeth, Mon 31st March – Positive Money Meetup

London – Greenwich, Wed 2nd Apr – Inaugural Positive Money meetup


4) More from the Blog

It’s official! Economics students are being misinformed, says Bank of England

Positive Money’s Chief Economist leaves as Bank of England now knows where money comes from

The Bank of England dismisses the ‘money multiplier’ theory

Building a movement for change (A Report of Positive Money’s 2014 Conference)

Will Green Party in Ireland pass full reserve banking motion?

Adair Turner on the Politics of Finance on BBC Radio 4

Best wishes,

Ben and the rest of the Positive Money team