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A comment on Why did Warren Buffett invest $6B+ in centuries-old Japanese trading houses?. Parent comment
A leverage ratio of 4% would mean that for every $1 of capital that a bank holds in reserve, the bank can lend $25. (1/25 = 4%)
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A leverage ratio of 4% would mean that for every $1 of capital that a bank holds in reserve, the bank can lend $25. (1/25 = 4%)