Fractional Reserve Banking Where do bank profits come from? If we restrict ourselves to thinking only about commercial banks and forget about investment banks (many banks are both things), I think they make money primarily by making loans and charging interest. Although banks start out life with capital from their investors, they really make money by making loans of the money deposited by you and many other people or businesses. In other words, banks only maintain a fraction of the money deposited with them on hand as reserves to cover daily operations. So, if a bank has deposits (assets) of [...]
profits
Obama Stimulated Smith and Wesson
I think I owe the POTUS an apology. Apparently, he has stimulated something, namely, the profits at Smith and Wesson. The Blaze has this graphic… Well, if Smith and Wesson is having record profits, it means that their stock is likely up, which helps it’s investors-many of which will be retirement funds. Also, they mad add employees to deal with the excess demand. Also, if they have a profit sharing plan, their employees might benefit. In other words, this is different than a government stimulus, because Smith and Wesson will be around for a long time, and they will continue [...]
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