If you deposit $10,000 into a bank 🏦
Here’s what happens…
The bank set asides a 10% and loans out the rest of your money.
How it works, say another person comes in and asks for a car loan...
I don’t think it works this way.
When you take out a 500k mortgage, they are not lending you 90% of someone else money. They literally have a license to magic up that 500k out of nowhere, and lend it to you at interest.
Since the scamdemic, there is no longer a requirement to have any reserves.
When you take out a 500k mortgage, they are not lending you 90% of someone else money. They literally have a license to magic up that 500k out of nowhere, and lend it to you at interest.
Since the scamdemic, there is no longer a requirement to have any reserves.
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