Sentences with phrase «fractional reserve lending»

That's the downside of fractional reserve lending.

That is why it is called «fractional reserve lending» — they keep a fraction as a reserve.

The only difference with conventional lending is that it prohibits dreaded fractional reserve lending.

Not exact matches

Concurrent with this orgy of public debt, the State encourages massive expansion of private credit via fractional lending, low bank reserves, and other forms of leverage, in a vain attempt to stimulate demand in an economy burdened with overcapacity, declining employment, marginal return on capital and saturated markets.

Banking Rule # 1 does not say that fractional reserve banks must lend out their excess reserves, only that they can not lend more than their excess reserves.

We discussed earlier that the banks benefit from fractional reserve banking by being the first to access the new money that is created by their fractional lending.

There is no limit as to how much Credit the banking system can create through fractional reserve banking — other than the ability of the borrowers to pay interest on the money they have been lent.

Either can be tweaked to curb lending and prevent $ 700bln + from entering the economy and being multiplied by our fractional reserve system.

Under the fractional reserve banking system, depository institutions lend out most of the deposits they receive from customers.

Any person who creates or originates United States money by lending against deposits, through so - called fractional reserve banking, or by any other means, after the effective date shall be fined under title 18, United States Code, imprisoned for not more than 5 years, or both.

Deposit insurance is only needed when money is created out of debt through fractional reserve banking, and then that debt becomes the basis of more debt - based lending in a vicious cycle of deceit.

I mean a normal person isn't allowed to lend what he does not owe, but a bank can do that under the fractional reserve rule.

Just like you said for Ponzi schemes «the only source of the so - called interest on the money was the contributions of future investors», for fractional - reserve banking the source of interest is the future profit made by lending the investor's money - to the investors themselves!

Fractional reserve banking is the practice of keeping only a fraction of a bank's demand deposits on reserve, while lending out the rest.

We do not leverage your collateral for other products or services (no fractional - reserve lending).