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by spiralx
1962 days ago
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Banks don't use deposits to make loans though, that's a widespread misconception which is perpetuated by concepts such as 'fractional reserve banking'. In the modern economy bank lending is simply adding a number to someone's account and adding an equal number to the bank's loan sheet. https://www.bankofengland.co.uk/-/media/boe/files/quarterly-... Simply put a bank with zero deposits could still lend money, the only constraints are risk and regulation. |
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