Why doesn't anyone run on the banks to get their gold back? What do you call the bill that the banks lend you? Why isn't gold allowed to be used as legal tender? Why are there no private mints? What system is Chase Bank, and Citi Bank, and JP Morgan and Goldman Sachs a part of?
You separate the 12 reserve banks, and the Fed Board from the rest of the banking system. Its all the same. One thing. The federal reserve system. Banks can lend irresponsibly because they have a lender of last resort. There are no deposits. There is no specie.
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