piotr on Nostr: I think it has something to do with fractional banking reserve, which if I'm not ...

I think it has something to do with fractional banking reserve, which if I'm not mistaken is regulated by law.

quoting
nevent1q…985m

How money is created: Banks don’t just hold your deposits, they lend them out.

That borrower deposits the money elsewhere, and it gets lent out again.

Through this cycle, a single dollar can circulate through the economy multiple times, expanding the money supply far beyond what was originally deposited.

Most people have never heard of this. It’s called the money multiplier effect.