The numbers in his example of fractional-reserve banking are wrong. With an original cash deposit of $1111.12, and 10% reserve requirement, you should end up w

The numbers in his example of fractional-reserve banking are wrong. With an original cash deposit of $1111.12, and 10% reserve requirement, you should end up with $10,000 of total credit. 90% of the $1111.12 gets loaned out, but goes right back into the banking system. Repeat. 90% of that sum gets loaned out, but goes back into the banking system. The loan sizes approach zero. Each time a loan is made, more of the original $1111.12 becomes part of the reserve. At some point, it is all reserve, which means it represents 10% of all the money circulating in the system. At that point, the banking system has $10,000 total in all accounts.