30th March 2026
Your savings are dead money. That's the uncomfortable truth about how money works that politicians don't want you to understand.
In this video, I explain why UK savings — including ISAs holding over £700 billion and pension funds costing the taxpayer £70 billion a year in subsidies — do nothing for economic growth, don't fund investment, and don't create jobs.
This is about how banks create money and the banking system explained honestly. When a bank makes a loan, it doesn't lend your deposits — it creates new money from nothing. Your savings sitting in a bank deposit simply give the bank cheap capital. They don't fund wages, they don't fund taxation, and they certainly don't fund productive investment in the UK economy. The same applies to the stock market — well over 99% of share transactions are secondhand shares, meaning your money in stocks and pension funds investment doesn't reach companies either.
This matters because savings vs investment is the key question for UK economic growth. We spend ÂŁ80 billion a year of public money subsidising saving when we should be subsidising productive investment. Understanding how money works, how banks work, and why fractional reserve banking means your deposits are actually at risk is essential financial education. If we shifted incentives from dead money to real investment, we could build a fairer, more productive economy. It's time to tell your MP.
00:00 — Why "savings are dead money" (and why people disagree)
01:10 — The UK obsession with saving: ISAs, pensions, and subsidies
02:20 — What “dead money” actually means in the economy
03:30 — The common myth: savings fund loans and investment
04:40 — What money really is: debt, not a physical thing
05:50 — Why bank deposits are personal contracts, not shared funds
06:50 — How banks actually create money when they lend
08:00 — Why loans create deposits (not the other way around)
09:00 — What savings in banks really do (and don't do)
10:00 — Deposits as “cheap capital” for banks
10:50 — Why savings don’t fund growth, wages, or production
11:40 — The same problem with shares and pension funds
12:30 — Why most investment is secondhand (and doesn’t create new activity)
13:15 — Why government incentives for saving may be misguided
14:00 — Rethinking policy: from saving subsidies to real investment
14:40 — Conclusion: dead money vs productive economic activity
TRANSCRIPT
A transcript for this video is available at: https://www.taxresearch.org.uk