I) Consider that by accounting identity the total value of all money used in the exchange of goods in any one period is equal to the value of all goods exchanged in that period.
II) Now cast to the future. The NPV of all money used in exchange from now till point T is by the same identity equal to the NPV of all goods exchanged between now and point T.
III) So consider that credit is issued to finance the production of those goods and is repaid in full at the end of that period. Assuming that production and consumptions plans are correctly anticipated then the addition to the stock of money is exactly cancelled by debt redemption , assume multiple overlapping period of production then it is the same as Clark parable of the forest, there is no net change to the capital stock, there is…
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