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The banking system as a whole can create an amount of money that is a multiple of deposits. The bank lending leads to new deposits in the banking system and a multiplier effect on the money supply. In a check-able deposits only system (no cash), the money supply equals bank reserves divided by the reserve ratio.
This video provides an introduction to how a bank works and how they make money. It takes simple examples to explain the core business of taking deposits and lending money.
