Offer your thoughts or opinion on the input financial query or topic using your financial background.

Who creates money? Central banks or commercial banks? 
Scenario 1 is typically the better description. If commercial banks were allowed to simply "create" money, they wouldn't be in the mess they're in now. In the U.S., the central bank is the Federal Reserve or Fed, and is the only entity (not the government, not the banks, not the people) that is allowed to create money "out of thin air". It does this primarily by buying government debt. The government spends more than it takes in, and so to come up with the deficit, it issues bonds. The Fed buys a certain amount of these bonds, and simply prints the money (or more realistically authorized the electronic transfer of $X to the Treasury) which the government then spends. That places money in the hands of corporations and the people, who turn around and spend it. However, long-term, the interest charges on money borrowed from the Fed will actually remove money from the economy. The central banks, therefore, have to constantly make marginal changes to various monetary policy tools they have when the economy is just humming along. If they do nothing, then too much of a short-term increase in money supply will result in there being "too much money" which makes an individual monetary unit worth less (inflation), while making money too hard to get will reduce the rate at which it's spent, reducing GDP and causing recessions. The exact scenario you describe is typically seen in cases where the government is running with a balanced budget, and the central bank thus can't give its "new money" to the government to spend when it wants to increase the money supply. In that situation, the central bank instead lowers its lending rate, the percentage interest that it will charge on loans made to other banks, thereby encouraging those banks to borrow more of the money created by the central bank. Those banks will then use the money to make loans, invest in the market, etc etc which puts the money in the economy.  In the U.S., the Fed does have this tool as well, but increases or decreases in the "Federal Funds Rate" are typically used to influence the rate that banks charge each other to borrow money, thus encouraging or discouraging this lending. A lowering in the interest rate makes banks more likely to borrow from each other (and from the Fed but the amount of money "created" this way is a drop in the bucket compared to current "quantitative easing"), and thus increases the "turnover" of the existing money in the economy (how many times a theoretical individual dollar is spent in a given time period).