From: "Tim" 
Newsgroups: uk.finance ie.general
Subject: Re: Fixed-rate Loans
Date: Mon, 26 Mar 2007 14:22:02 +0100

> "Tim" wrote:
>>...  Let's say there are 10 million such "individuals", and on
>>AVERAGE each is worth 400 and can spend 1400.  That's
>>a total worth of some 4 billion, and spending power of 14 billion.
>>
>>BUT the money supply can sit anywhere between 4
>>billion and 14 billion - depending on how the 10
>>million individuals have set up their accounts.  See?
>>

"Padraig Breathnach" wrote
> Do you not see how improbable your scenario is? Of course you do.

If you think that the averages of 400 and 1400 above are "improbable",
then replace them with your own estimates.  *Then* multiply them by
10 million and you get exactly the same effect.  My point does not rest
on the probability or improbability of those particular estimates...

"Padraig Breathnach" wrote
> The average sensible punter will not borrow
> simply to have money sitting in an account...

Have you not noticed the number of "offset mortgages" nowadays?
In effect, that is exactly what is happening with those!