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– it is money the bank has itself borrowed from somewhere else (maybe another bank initially, but ultimately from either accounts held with banks or from central banks).
Well, no banks don’t borrow the money from somewhere else. It hasn’t come from anywhere, its is literally created when you take out a loan.
When you or me, or a company, or another bank, or any financial entity places money into a bank account they are lending money to that bank. And while that bank does put a certain amount of that money aside in order to remain liquid, most of that money is placed into an account with another bank – i.e. your bank lends out your money to another bank, and so on. Every time a part of that money gets lent on it appears on the books of more and more banks and therefore the amount of (broad) money in circulation increases. That is how fractional reserve banking works. By starting off with say €100 of cash (narrow money) being placed into a bank account, the banks are able to create several times that amount in credit (boad money). Eventually some of that credit is lent out to people as loans. While it seems like the money is created from nowhere it is in fact the same €100 appearing simultaneously on the books of multiple banks as IOUs.
This is not the same as “creating money from nowhere” which is what you seem to be suggesting. If banks could do this there simply wouldn’t have been a credit crunch (there’d be hyperinflation instead)
The hyperinflation is comming you just wait and see. The inflation could most easily be see on the rise of real estate prices the last 10-20 years. The credit crunch happened because none wanted to be stuck with worthless assets. The owners of the banks where simply to greedy otherwise this could have gone of forever. Not that this was any real wealth just more FIAT-money in circulation. Money these days are created in the same instance as the banks approves new loans.