| > What you're missing here is that if I were to keep my own records, I would also list two accounts. The passage you quoted is from an earlier comment, so you are responding to something way out of context. Let's rewind: > Unlike the bank, your account at the utility company represents how much you owe them. So the meaning of debit/credit is reversed, but so is the direction of responsibility: your account at the utility provider is money you owe them, which is an asset. No. There is no such thing as "an asset" without further qualification. The money you owe the utility company is an asset to them, but to you it's a liability. This is true for all financial instruments, including cash. Cash is an asset to its owner, a liability to society at large. So... > The cash itself isn't both things- it's only ever an asset. No, cash is a liability to society at large. The bookkeeping for this happens at the central bank. See: https://www.federalreserve.gov/monetarypolicy/bst_frliabilit... "The major items on the liability side of the Federal Reserve balance sheet are Federal Reserve notes (U.S. paper currency)..." |