[Suncho]

> How does the system guarantee that nobody's creating money without notifying everyone?

This is a comment that's not related to SWIFT in particular.

Every asset (including money) is generally someone else's liability. The money that we hold as an asset is the liability of a bank. Anyone can issue their own liabilities, but you can't create money that's a liability of someone else. For example, I can't go to my bank and tell them I have a million dollars more in my deposit account than I actually do. They're keeping track on their end.

Similarly, a bank can't pretend that it has more reserve deposits at the Fed than it really does. The Fed keeps track of everybody's reserve accounts on their end.

> Furthermore, does the system guarantee that the central banks of each country are correctly adjusting their books in consequence?

This isn't an issue. The books of central banks don't need to adjust when other banks issue money (i.e deposits).

[dannyw]

To be more specific, central banks are allowed to create money. Their liability is /dev/null. It's how they added trillions to their balance sheet during COVID.

[endisneigh]

Not really their liability is basically the present value of the future which is indeterminate, not null. If the future pain is greater than the present value, or billions printed, then they printed too much, otherwise it was worth it.

You can’t really know for sure if it’s worth it now though.

[baby]

I think what he means is that they can literally credit an account with new money in their database and it would work.

[endisneigh]

Yes but my point is that the liability and asset paradigm described still will hold.

It’s simply that the liabilities are held by people who aren’t born or are obsfucated to the point that people don’t realize they are holding them. Inflation is one example