let's say the bank bought a T-bill from you for $1000. for this, they "created $1000" and deposited them into your account. bank’s balance sheet: ➖ Assets: +$1000 (the T-bill) ➖ Liabilities: +$1000 (the deposit/payment to you) the key here is that you are a NON-bank

Illya Gerasymchuk 2025-08-22 13:04

here, the bank's assets increase by the value of the T-bill and liabilities increase by the amount that they paid you for it. in the balance sheet the T-bill will have the same value as what the bank paid you/deposited into your account