@theabsolute, I'm sorry. I don't know the people who are disagreeing with me.
It appeared as if I was interacting with someone who had a more innate knowledge about economics than myself and had a legitimate concern about something that I wrote (which, I, admittedly, hold no real knowledge, beyond that of a passing mathematician). You should've seen that at the end of the day (via the course of the dialogue that went on for several hours, if you were following), when we were both able to obtain an agreed upon definition what is money multiplication that we were able to better ascertain the nature of how it is caused.
My initial assumption that it only happens through the lending of deposits, which I conceded to be false in evidence to the contrary, modeled the growth as an infinite geometric series.
Even though my initial assumption was wrong, the same mathematical analysis and model can be applied to fractional reserve banking at large, assuming everything is fixed.
I was presented with a well-laid out real-world example that described the process in such a way that both my intellectual adversary (adversary -- is that the proper word? probably not) agreed.
I understand your field is physics, and you are right that you (or anyone) should keep an open mind.
There is a lot that doesn't make sense. I agree. And intuition can lead one astray.
But if you do the math (and also listen to those who have experience in their disciplines and experts in their field, or don't listen if you do not believe them...) you can tackle the situation with a bit more clarity.