Quote:
Originally Posted by iLney
So it's like the classic:
I have 100$. I lend you 90$. You put 90$ in my bank. The market has 190$?  |
No.
You have $100. You lend me $90. I invest that $90 into buying raw materials and employee costs. That $90 then gets deposited into another bank by my suppliers, and then said other bank lends 81, and thus the total amount of money created isn't $190, but $1000.