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My thoughts exactly. How can they justify simply taking deposits?
by jemaddux 14y ago
My thoughts exactly. How can they justify simply taking deposits?
- nwzpaperman 14y agoFact 1: Deposits are loans from depositor to bank. Fact 2: Deposits are accounted for as liabilities on the banks' balance sheets. Fact 3: Banks write multiple loans against each dollar deposit; it has a fancy name: fractional reserve banking. Fact 4: Most countries are now on zero reserve banking and only manage their loan portfolio size by the amount of capital they have on their balance sheets.