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Fractional-reserve banking

Posted by financeplanet on June 1, 2007

Fractional-reserve banking refers to the common banking practice of issuing more money than the bank holds as reserves. Banks in modern economies typically loan their customers many times the sum of the cash reserves that they hold.

This entry was posted on June 1, 2007 at 4:27 pm and is filed under Life. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

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