You can’t withdraw all your money from your bank account because it is constantly being invested and reinvested, but how come banks are never ‘down’ on these investments in the same way the average person is with their investments? Are they protected by government guarantee so they can just reap huge profits by investing constantly without risk?
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Deposit banks and investment banks are different things. A big part of the financial crash in ‘08 was allowing deposit banks to act like investment banks.
Deposit banks pay you interest on your deposits. They loan out said deposits for a higher rate than they’re paying you. What does your bank currently pay for your savings account? Now go look up the rates they would charge you for an auto loan. That’s how they make money.
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