00:00When you deposit $10,000 into your bank account, the bank does not keep it in a vault.
00:06Legally, that cash is no longer yours.
00:09Your account balance is merely a digital IOU.
00:12Under fractional reserve banking, banks keep 10% in cash and lend 90% out as mortgages and business debt.
00:20Through the money multiplier, every single $1,000 deposited ripples through the economy,
00:25creating $10,000 of new purchasing power out of thin air.
00:30This makes banking a miraculous economic engine, but it also creates extreme fragility.
00:35If panic spreads, a digital bank run can drain billions in hours.
00:40We broke down the entire 16-minute masterclass in our pinned breakdown below.
00:45Click the link right now to master how the money machine works or keep doom scrolling and stay broke.
00:50We are The Money Formula, where future millionaires come to motivate.
