Crime Against Humanity: “National”, “Federal”, “Central” Banking, 14

The central bank backs up its credit identically to its banknotes: by the end of the “ambiguous money cycle”, when demanded redemption of credit, for that credit it issues and exchanges banknotes; when demanded redemption of banknotes, for those banknotes it issues and exchanges more banknotes. Both cases, it issues something created at will out of thin air at zero cost.
The other banks back up their credit with banknotes: when demanded redemption of credit, for that credit they exchange banknotes that they have to borrow from the central bank; the central bank demands that they expand their credit within the limit of the fractional reserve, dictates the current reserve ratio, and demands that they keep their reserves deposited in the central bank itself, so the other banks must have reserves no less than that ratio for the credit they create, and keep those reserves in the central bank. That is to say, the other banks issue credit created out of thin air at zero cost, in a quantity not exceeding that dictated by the central bank.
To say that the reserves of the central bank are as infinite as the thin air they originate from is incomplete: indeed people is told that the central bank is there to back it all up, but the cornucopia presented as the one the central bank taps into to back it all up in the final analysis is the State, not thin air. Small meaningless detail we are going to discuss in a moment…
The reserves of the other banks may also be comprised of own capital and embezzled customer’s deposits, but since the prime source of credit and money is the central bank, they’re basically and mainly comprised of central bank loans. Remarkably enough, what these reserves mainly consist of is not banknotes, but bank credit: that is, they are promises backed by other promises, not by deliveries.
To sum it up, a unit of bank credit issued out of nothing at zero cost is backed by only a fraction of it in central bank credit issued out of nothing at zero cost, which in turn is backed by only a fraction of it in… actual value at first, which as soon as possible is replaced by thin air. Some call it double pyramiding.