Figure 1. The simplest circuit scheme.
Clearing Banks
Discharge Debts
Financial System
Initial finance (loans)
Wages
Firms
Final finance
Households
Expenditure
Household Savings
Figure 2. Government budget deficit and central bank.
Central Bank
Discharge Debts
Financial System
Initial finance (loans)
Government
Wages;
Transfer
payments
Final finance
Tax Revenue
Household Savings
Households
Figure 3. Financialisation in the monetary circuit scheme.
Debt discharge
Debt discharge
Banks (clearing)
Consumer credit
Loans
Securitized
loans
Funds
Savings
Firms
Savings
Households
Financial System
Credit
Final finance
Revenue
Commodity
Markets
Wages
Expenditure
Figure 4. Long intermediation chain.
Households
Households
Mortgage
MMF Shares
Mortgage Pool
Money Mkt Fund
Short-Term Paper
MBS
ABS Issuer
ABS
Repo
Securities Firm
Commercial Banks
Source: Adrian and Shin (2010).
Figure 5. The chain through financial assets as between savings and investment.
Financial
Asset A1
Savings
Financial
Asset A2
Investment
Financial
Asset A3
Financial
Asset A4