How Banks Make Money
- Author
- Valerie LaRoque
- Published
- Thu 02 Mar 2023
- Episode Link
- https://sites.libsyn.com/452085/how-banks-make-money
Have you ever wondered why there’s a maximum withdrawal limit at the bank?
They’ll often tout it as “stopping criminals from laundering money.” But the reality is this: They don’t have much money in the actual bank!
What do I mean?
The primary way banks make money is by lending out YOUR money. Banks only need to keep about 10% of deposits on reserves. So when you make a deposit, they loan out your money (and then some!) and earn their profit by charging interest.
The only reason why this has worked is because the banks know 90% of all savings are untouched by the public — they don’t take their money out, they leave it in the bank.
But this was one of the causes of the Great Depression. The public were scared of a market crash, decided to take out all their money as the banks weren’t safe anymore, and they were told…
There was no money left!
But there is a way to be free from this madness. In today’s episode, I reveal “The Family Banking System”, which allows you to recapture the interest you’re losing to banks.
Listen now!
Show Highlights Include:
- Why the banks are legally allowed to take your money and then sell it back to you (and make a handsome profit) (0:56)
- Our banking system would collapse if everyone withdrew their money all at once. It’s known as fractional reserve banking, and you can learn how it started at (1:21)
- How banks make a profit off every single transaction you make with the “3 Circle Exercise” (5:04)
- Why Bank of America gets away with a 16x return on investment on YOUR savings (6:29)
- How to take out a loan with a terrible FICO credit score (8:18)
Reach out to me:
