private equity : the big bank theory

https://g.co/gemini/share/7952d5e7eddd

To critically evaluate the hypothesis that the private equity sector functions as a de facto, unregulated banking system engaged in invisible money creation, it is first essential to establish a clear and precise understanding of how money is officially created and measured within the regulated financial system. The modern economy's lifeblood is not primarily physical currency but rather the digital liabilities of commercial banks. The process by which these liabilities are created, the regulatory framework that constrains this creation, and the statistical aggregates used to measure the resulting money supply form the foundational architecture against which any parallel or "shadow" system must be compared. This section deconstructs that architecture, revealing a system whose core economic function is inextricably linked to a dense web of prudential oversight—a link that is conspicuously absent in the world of private equity.