The superpower of banks is to take the dollar from you and lend 90 cents to your friend while promising that when you need your dollar they will have enough money around to make you whole. (When the time comes, they may or may not be able to keep their promise.)

Please, stop promoting this false conception of how banks operate. It makes really difficult to have serious discussions about the modern economy.

From the Bank of England, banks are not intermediaries of loanable funds:

https://www.bankofengland.co.uk/working-paper/2015/banks-are...

I'm sorry you didn't like that simplification. Anyway, it's better than "you have no money but you can make it appear from nowhere and lend it because you are a bank and have special powers".

The more details are given, the less interesting the special powers of commercial banks seem to be: not only is the amount of money that they can create limited to some multiple of the "real money" base, but they don't even lend that much out because it's not profitable.

But the "real money base" will expand on demand if the banks need it. It's not a limiting factor! The loan happens first. The base money is created (if needed) after the fact. It's not as if base money is pushed out there and then the base money is used to create loans. Loans pull base money into being.

It’s not a limiting factor anyway because US banks have 1.4 trillion dollars in excess reserves deposited at the Fed (down from 2.7 trillions five years ago!).

The monetary base (physical currency plus banks deposits at the Fed) is currently $3.3tn.

M1 (circulating cash plus on demand deposits) is $3.9tn (the money multiplier is slightly above 1, but it was below 1 for most of this decade!).

M2 (including also savings accounts) is $14.9tn. M2/MB is 4.5, it has ranged between 3 and 5 over the last 10 years. It was between 8 and 12 in the four decades before 2008.

The superpower of banks is taking a dollar from you and lending 10 dollars to someone else. With interests.

That special power is literally the distinction between bank and central bank, and what this whole thread is about.

Central banks do have that special power, they can literally create money out of nothing. A normal bank can lend out a $, but they need to have taken a $ deposit, and it stays on the banks balance sheet.

Normal banks special powers are turning risky illiquid debt and making it appear risk free and liquid to depositors.