I get it.
The loans are based on nothing, which is why we are now in this crisis.
When the banks can leverage by 10X the 'deposits' and loans at full value and then get us to TARP them out, that is where the evil of Fractional Reserve Banking comes fully into play.
My great-grandchildren (at least) will be obligated to pay for this greed-game of multiplied 'money' that has now started to collapse, and the perpetrators of the scheme will be living off the labor stolen from us in the form of our plundered 401Ks while we pay back Bernake's loans.
Truly a sweet gig if one can get it.
If they loan 90% of deposits they clearly aren't loaning 1000% of deposits. Maybe you shouldn't try to do the math?
then get us to TARP them out, that is where the evil of Fractional Reserve Banking comes fully into play.
It's true, we wouldn't need TARP if banks had to reserve 100% of deposits.
while we pay back Bernake's loans.
Bernanke is Chairman of the Fed. TARP involves the Treasury.