# Fractional Reserve Banking Summary::A banking structure mostly abandoned in 2020. Somewhere along the way bankers decided that since depositors were only demanding a portion of their dollars at any one time, banks could lend a portion for fraction) of those deposits without depositors being any the wiser. Because banks maintained only a fraction of the reserves needed to honor all the claims of depositors, this became known as "fractional reserve banking." By violating their promises to all depositors banks committed an act of fraud. But, it seemed to work. Banks maintained a relatively large percentage of deposits as reserves, and they specialize in short term loans. So they could honor most claims on their reserves. But that did not make fraction reserve banking any less of a fraud. The in 1913, with the Federal Reserve Act, the Federal government legalized and institutionalize the banking fraud known as "fractional reserve banking." ## fractional reserve banking a system in which a bank can issue multiple receipts for the monetary commodity it has on hand. # References / Links [[Money Mutiplier]] # Graphics describing Fractional Reserve Banking ## First Iteration This graphic is flawed because the fulcrum is at the wrong poin. ![[Fractional Bank Reserves.png]] ## Second Iteration This chart need more work, but it's getting there. ![[Fractional Bank Reserves 3.png]] # Publications [The Fraud Known as Banking](https://freemarketcenterjournal.com/2023/05/05/the-fraud-known-as-banking/) --- # References [[Advocating 100% Bank Reserves]] [[Banks & Reserves]] [[Money Claims All The Way Down]] [[Problems with the Theory and History of Fractional Reserve Free Banking]] [[Salerno on Fractional Reserve Banking]] [[Fractional Reserves Spreadsheet]] > [!Info]- Ignore dataview >## Backlink >Ignore this dataview. Plugins don't work on the website >```dataview Table Status, type as "Type" from [[]] and !outgoing([[]]) sort file.name asc >```