No, they say "I'm going to claim you can have $5000, because I can document that once I took in $1000 and I assert that I will take in $1000 again, perhaps many

No, they say "I'm going to claim you can have $5000, because I can document that once I took in $1000 and I assert that I will take in $1000 again, perhaps many times". Never mind $500, they don't even need to touch the $1000 you put in. They are just making it up as they go because they're a bank and can credibly assert that they will be handling capital in future. They are using the FACT of having deposits to get the credibility to make up whatever loans they want. This is why leverage is like ten to one making the amount of capital in the world many times the assets of the world and everything in it. When you withdraw $500 _they_just_make_it_up_.