Highly recommend reading Steve Keen&#x27;s &quot;The Roving Cavaliers of Credit&quot; for a dose of reality on the whole process.<p>tl;dr &quot;banks extend credit, cre­at­ing deposits in the process, and look for reserves later&quot;<p><a href="http:&#x2F;&#x2F;www.debtdeflation.com&#x2F;blogs&#x2F;2009&#x2F;01&#x2F;31&#x2F;therovingcavaliersofcredit&#x2F;" rel="nofollow">http:&#x2F;&#x2F;www.debtdeflation.com&#x2F;blogs&#x2F;2009&#x2F;01&#x2F;31&#x2F;therovingcaval...</a>