how banks developed out of goldsmith establishments (3)

the bank would still cover its overhead and clerical expenses by making customers pay storage charges. these would presumably vary with the length of time the customer left his money for safekeeping , the average amount of his money requiring safekeeping , and the number of times the turnover of his account made a clerk wait on him and keep various records .
Economists could ignore such a bank is operations . the bank money - the demand deposits created jointly by the bank is willingness to accept a demand obligation and the customer is willingness to hold a deposit-would just offset the amount of ordinary money (currency or coin ) placed in the bank is safe and withdrawn from active circulation . The process would be of no more interest than if the public decided to convert dollars into dimes . One says that the banking system has a neutral effect on spending and prices-not adding or subtracting from total M or velocity .