[joefkelley]

I could be wrong (I'm not a finance guy) but this isn't my understanding of how fractional reserve banking works.

If Apple deposits $200 billion and the ratio is 1/10, then the bank can loan out $180 billion of that 200; it must keep $20 billion in reserve - 1/10th.

In your scenario, the bank has negative $1.8 trillion in reserve.

[roenxi]

You are right as far as you went, but it doesn't stop there. The 180 billion all but has to end up in a bank account somewhere and that bank will then lend out a further 9/10ths of the 180 billion. The limit of that action repeating over and over implies that 1/ratio dollars are created. As a rough theory.

But exactly how it all works out depends on a countries legal and financial implementation details.

[joefkelley]

Ah! Thanks for explaining, that makes sense.