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> they're lending out $100 to a couple people no they're not, they're loaning out 100$ total. they never have loaned out more than they had on their books, it'
by namdnay 3y ago
> they're lending out $100 to a couple people
no they're not, they're loaning out 100$ total. they never have loaned out more than they had on their books, it's not possible
- Zak 3y agoBanks can and do loan out more money than they have on deposit; they borrow from the central bank in their jurisdiction when required. https://en.wikipedia.org/wiki/Fractional-reserve_banking https://en.wikipedia.org/wiki/Fractional-reserve_banking