You are viewing a single comment's thread.

view the rest of the comments →

1
-1

[–] WORF_MOTORBOATS_TROI 1 point -1 points (+0|-1) ago 

This isn't creating money. The op is adding credits and debits. On a balance sheet the deposits are all on one side of the balance sheet for money owed to others, while the loans are on the other side as money owed to the bank. The 10% "fractional reserve" is the amount that they must keep on hand in order to pay out tbe money owed to others in the event that a customer comes in to collect. That's why they pay more interest for a CD or something where you agree you won't collect until a certain future date.