And let's say that I can, in the bank,

So what I do is, I take their 900 gold pieces, and I take it as a deposit.

I just give them a checking account.

Scarlett's deposits.

When you put money in the bank, you deposit it.

So 10 of 110 is 11.

Checking,savings took out about 125,000 in cash.

I want to deposit some money.

And we went the fractional reserve route.

I'll open a bank account.

I have a fairly wealthy village.

The bank keeps money for people.

He deposited the prize money in the bank.

The money rests in a safe at the bank.

Well, no. Because then a bank take on arbitrary amounts of risk and there are regulations, although I think a bank would do it on their own to some degree, but there're regulations called reserve requirements that tell us how much lending can a bank do relative to its actual reserves. In this case, it's reserves of gold.

So this is the account of B. The account of Villager B.

You know, about my money.

And I think something happened, right? He put aside a little cash for you.

It's in a safety deposit box.

That would be total bank notes in this case and bank notes are also something we'll later leave a world where every bank is issuing bank notes, but I just wanted to give you that kind of historical context, how bank notes even started off.

But it's the same idea.

So how can we do that?

There is a reserve requirement.

Oh, I have your winnings from last night.

At the beginning of the week,

I trusted him with the money.

So what would be total demand liabilities?

I could've actually issued bank notes, same idea.

Put the money in the bank.

Keep this money for me.

Your account is empty.

If this is 1,000, 900 might be about that.

So that would be your savings account at period zero.

I have a lot of money in my savings account.

He left his safe in my care.

Deposits on long term leases.

I entrusted my money to him.

And then instead of giving them actual gold,

That's where all these people here put their money.

That means as long as at any given moment in time, more than 20 of these people don't demand their money back, the bank's going to have liquidity.

She put the money in the bank.

He has a credit of 3000 at his bank.

I've deposited the money in the bank.

I only have 1,000 of cash.

I can make a checking account, 100.