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> The rest is electronic, just numbers in reputable databases

yes, but they can't fiddle those numbers. if you deposit 100$, they can lend up to 100$. no more



That's not how the banking system works in theory or practice. It hasn't worked like that for a very very long time.

Lending isn't limited by deposits, it's limited by central bank regulations.

Here's what the Bank of England says [0]

> if you borrow £100 from the bank, and it credits your account with the amount, ‘new money’ has been created. It didn’t exist until it was credited to your account.

> Regulation limits how much money banks can create.

Banks only need to maintain enough deposits to cover their liquidity needs - what they need to pay people withdrawing cash and what they need to transfer to other banks due to electronic money moving.

[0] https://www.bankofengland.co.uk/explainers/how-is-money-crea...




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