>>>The same is true in the US: under Democratic control, more money goes directly to those who need money (and therefore spend it right away) and to projects (like roads, bridges, etc.) that hire people. Those efforts result in less Federal debt after 4 or 8 years and a healthier economy. Under Republicans, the money goes to corporations, where a good chunk of it is never seen again. Money doesn't come from a "pot" -- it moves around the economy, either quickly or slowly. When it moves quickly, everyone benefits. This isn't just Keynesian theory -- it's been proven over and over again across the shifts in political power in the US.
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>>So Dem.=Good - Rep.=Bad. Got it.
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>>And I agree, "money doesn't come from a pot". But saying "it moves around the economy" doesn't explain where it does come from, Which is ... ?
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>Population growth. LOL actually thats partly true isn't it . more people more consumption more production more money. Just need to make sure what there is gets spread around a bit.

>I don't understand why population growth creates money. Nor how the velocity of money explains where money comes from. Where does the money supply come from? >How does money come into existence?

Well, when I was in school (about 100 years ago) I was taught it came from banks. But of course that was before 1971 - when things changed (gold standard). Today the system is about the same except the central banks (controlled by the Feds.) create money by deposits - which make loans. The difference of course is the money is no longer backup by gold. In the U.S. the actual paper cash is only a very small percentage of the total money available (I'll guess some where around 4%).
Johnf