Quote:
Originally Posted by onwebcam
Actually it's correct sir. It's called Fractional Reserve Banking. Look it up. And it's been going on since the days of the bible's writing.
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No, fractional reserve doesn't mean that. The fraction refers to the money the bank has left from the money it has got from (deposits, loans, what ever).
The 1/10 means that if bank gets 100 $ as a deposit, it can lend 90 $ from it, and it has to leave 10 $ for reserve.