Hirst is correct, but money created in that way accounts for less than 10% of all money in circulation
over 90% of all money in circulation is created by private borrowings.. when joe smith goes to the bank to borrow $500k for his mcmansion the bank creates the $500k with a keystroke and out of thin air.. when the value of joe's mcmansion (and thousands of others) plummets to $300k and he forecloses, that rips a lot of money out of the system, credit freezes and overall money supply drops
this drop from the credit freeze was greater than any amount of money that is being created by the govt.. we've been seeing asset deflation / price inflation since 2007, not fun
