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

And we'll do a little bit of math on that to figure out how far it can go.

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

And we went the fractional reserve route.

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

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

Let's say I take a 100 gold piece deposit, and of course I have an offsetting checking account that those people can at any point use either to write checks or at some point they can come back and demand their money back.

And then instead of giving them actual gold,

So this is my equity.

Let's say 300 gold pieces loan A and I do that just by giving Person A or Entrepreneur A or whoever took this loan out a 300 gold piece checking account.

Your account is empty.

I have a fairly wealthy village.

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

I have some things in the hotel safe.

This is liabilities.

We deposit money in a bank.

And then of course I have that 250,000.

I'll open a bank account.

But the gold is gone.

So how much could I expand my balance sheet?

Deposits on long term leases.

And I don't hand that person gold.

And he wants half of that in his checking account.

And then I can create a checking account for him.

And then I have 200 gold pieces that I just put into my building just to start it off.

You know, about my money.

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

He deposited the prize money in the bank.

I could have also issued notes and all of that, but let's say

I can assure you madam that our bank will provide your deposit with utter safety.

Then there was an innovation.

Can you save enough money for the down payment?

I'm done.

And like all of the other examples,

So he doesn't quite have 100,000.

I want to deposit some money.

So what would be total demand liabilities?

Now, the first entrepreneur, he's very conservative and he's been saving all his whole life to do this.

I trusted him with the money.

If you make your own clothes, it will save you money.

I, heh, thought twice about it.

But I have other expenses.

So 10 of 110 is 11.

Welcome aboard, sir. May I take your coat?

That was the initial money.