While the reserves that are required the deposit stay in their bank checking account (reserves acct) in the Fed.
A doesn’t have enough reserves in its account when the borrower makes the transfer, the bank borrows reserves from other banks, or in a worse case scenario, the Federal Reserve’s Discount Window which charges a penalty if the borrower decides to move the deposit to another bank (buying a house, for example), the reserves travel with the deposit to bank B. And if bank.
This might be key though” … a bank has to fund the created loans despite being able to produce cash, as it require main bank reserves to stay deals drawn regarding the deposits they create”
“How it finances the loans depends upon general expenses associated with the various available sources. As expenses increase, the ability to make loans decreases. ”
“The banking institutions told him that, if the us government would not guarantee their international debts, they might never be in a position to roll the debt over because it became due. Some ended up being due straight away, so they really would need to start credit that is withdrawing Australian borrowers. They might be insolvent sooner in place of later …”(Big business desires federal federal government to immediately cut funding them (if perhaps)march 22)
“A firm is equally as insolvent if it’s not in a position to fulfill its obligations while they fall due as it cannot roll over debt, because it’s in the event that value of the assets in its stability sheet is deeply weakened”
-I don’t think the way to obtain credit is perhaps all that powerful, banking institutions create loans after which need certainly to fund them via