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> So no, banks don't lend other people's money. Not a single bank in the modern world lends other people's money. That's easy then. In case of a bank run, just
by luckylion 5y ago
> So no, banks don't lend other people's money. Not a single bank in the modern world lends other people's money.
That's easy then. In case of a bank run, just give everyone their money back. They never loaned their customers' money, so they should have 100% of it ready to go.
- ArtTimeInvestor 5y agoThey might not have "loaned" their customers money but they don't have it anyhow. Because "their customers money" is just a number in their database. Imagine a new bank with no money and no customers. First customer walks in "Can I loan $100?". Bank: Sure. We make an account for you. Your account number is 1. Your balance is $100. Next day the customer walks in again. "I'd like to get my $100 in cash to go shopping". Bank: "Uh oh. Sorry, we have to file for bankruptcy."
- wyager 5y agoPeople who took out loans can withdraw money from the bank as well.