Comment: That only exists with a central bank...

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In reply to comment: It would also add up to $900,000 (see in situ)

That only exists with a central bank...

In a system of a free banking that doesn't exist. This effect only exists because of the central bank.

See the graph of the US and Canadian supply of banknotes in the below link. (1880 to 1900)

See figure 2 on page 10 in that .pdf.

In a free banking system any bank that only had $100,000 in reserves tried to loan out $900,000 they would overnight be put out of business by the clearing debt as soon as someone spent them or deposited them at another bank.

They would be on the hook for $800,000 they never had and the market would crush them.