Comment by immibis
1 year ago
Deposits≥Loans is a tautology since every time loans increase, so do deposits. It doesn't mean anything or provide any insight.
1 year ago
Deposits≥Loans is a tautology since every time loans increase, so do deposits. It doesn't mean anything or provide any insight.
Even deposit liabilities matched by deposit assets in other banks are essentially inter-bank loans. That is, deposits=loans in all cases.
I deposit $20. Deposits: $20. Loans: $0. Cash: $20.