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Personal Banking & Security
Basics of the banking industry
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What's the word for the gold a bank has in its vaults, which allows it to make loans?

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The gold a bank has in its vaults is called its reserves.

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For the most accurate look at how inflation may affect you, you should see how it's changed over what time period?

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Annual numbers will account for seasonal variations that might cause big but temporary changes from one month to the next.

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Key Takeaways

Print version

Banks can be more than just places to keep your money. By understanding a few basics, you could make the most of what banks have to offer.

  • For a true comparison of the cost of things from one year to another, you need to adjust for inflation
  • A bank's main role is to connect people who want to save money and people who want to borrow money
  • Use a commercial bank for checking accounts, mortgages and things like that—investment banks mostly provide funding and more to businesses
  • A bank's income statement shows you how much money goes into and out of the bank at a given time