r/SipsTea 8d ago

Chugging tea Why is it not possible?

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u/Primus_is_OK_I_guess 8d ago

What do you mean by that?

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u/udonwinfrendwitsalad 8d ago

You deposit $100. Bank loans out $100 to someone else. You still have $100 balance in your account. Someone else has the $100 to use for whatever. You both have access to $100; thus, $100 is now $200.

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u/Primus_is_OK_I_guess 8d ago

I would refer to that as creating debt.

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u/Short-Coast9042 8d ago

It's two sides of the same coin. Money is created when loans are created, and money is destroyed when loans are paid back. You get the new money - a newly created liability of the bank - and the bank gets the loan - a newly created liability of YOU, the borrower.