[nonbel]

> Increases in inequality and wealth concentration means there is more money to loan

Confiscate $3 trillion from the "rich", and give everyone in the US $10k dollars. What percent would end up back in the banking system after 1 year?

[nicoburns]

This is why you have to do it every year. Which is exactly what a progressive taxation system does (or would do if it was a little more progressive than current systems)

[nonbel]

I imagine you would have to "do it" every week to have the claimed effect...

With online banking, etc perhaps once a day.

EDIT:

Actually, if the funds are transferred electronically it would take as long as an ACH transfer takes to get to the new account. The funds are tied up during that but then immediately available to the banking system again.

[pas]

100%.

Banking system is where money lives.

Value lives outside, but the money represented by the value lives on accounts, in databases.

Even cash is just something tracked by central banks as liability (negative account value - because when someone deposits cash they increase one account, and if the bank then deposits that electronic money at the central bank the total money supply must not change, hence cash is tracked separately).