Zim Banks 101

We are all at risk. Academic economics literally ignores the real-world role of banks, money and credit. We have all heard the abstract mumbo-jumbo about a money multiplier, demand for money and other assumption based fictions, only useful for passing economic exams. 
Events like the  Great Crash of 2008 and Zimbabwe's 20 year recession demonstrate you cannot trust academic economics when it comes to money and banking.

Private banks hold the key to growth in business activity. As private banks stopped lending in 2008, the world economy stalled; in the 1990s, when Zim banks slowed lending, industrial sectors startered declining.

Banks hold two major assets: reserves at the Central Bank and loans. When the Central Bank cannot honour its 'lender of the last resort' position, high loan delinquency means private banks become operationally insolvent.

It is no surprise Zim Banks are always in trouble. Outright fraud, deliberate fund misuse  and poor lending practices have left smaller banks bankrupt. With the lender of the last resort failing to honour deposites made by larger banks,small and large banks lack the funding to support economic transformation.