[thelamest]

It’s not a closed system or a zero sum game. The average loan has positive expected value in terms of new, real goods and services being created – so it can be accompanied with an increase in nominal amount of money. The casino analogy falters here, because gambling is associated with, at best, only intangible entertainment value creation, and at worst, value destruction. Banks are somewhat free to create money, because they enable making new real value, and carry much of the risk for bad calls.