Because in the real world the room has 6 people and a bank. The bank has $100 and under the current reserve requirements is able to lend ~$95+ to each of the 6 guys. Voila, the “money supply” has just expanded by close to 6X...
Or, in very simply terms, the bank opens for business, takes in a $5 deposit from the guy who just sold his corn, then lends out $100 with $95 of that bring created out of thin air by fractional reserve banking. Most of that is binary digits but a truck from NYC does bring by some currency that the corn farmer borrows to buy another corn field from his neighbor for cash.
Nope. $95 to one guy.
Voila, the "money supply" has just expanded by close to 6X...
Nope. Expanded by 95%.