Trillion Spending Bill Great for Wall Street and the Rich, Harmful to Workers

[ckaihatsu]

Trillion Spending Bill Great for Wall Street and the Rich, Harmful to Workers


[Please forward widely.]


$1.1 TRILLION SPENDING BILL GREAT FOR WALL STREET ANDTHE RICH,
MAJOR SETBACK FOR WORKING CLASS


When the smoke finally cleared and the 1,600-page omnibus spending bill enacted by Congress was published, one thing was abundantly clear: Wall Street and the big banks and corporations had a lot to cheer about, while the labor movement and its allies had suffered a further devastating setback. Here is just a partial list of what is wrong with the bill, now signed into law by the president:

Pension Cuts

The bill permits pensions for more than 10 million retirees to be cut. According to the December 15 Wall Street Journal, this especially affects multi-employer plans, jointly run by unions and employers. As explained by the Journal, "The bill would allow troubled funds to cut benefits for current retirees. . . . That is an exception to a long-standing federal rule against scaling back private pension benefits."

The measure "would set a terrible precedent," said Karen Friedman, executive vice president of the Pension Rights Center, a group that advocates for wider pension coverage and opposes benefit cuts. The bill would encourage similar cutbacks in troubled state and local pension plans and possibly even Social Security and Medicare, she noted.

In short, countless additional millions of retirees, both in the public and private sectors, would be adversely hurt down the road.

Here is one example among many of how our unions will be impacted: UPS will not be obligated to pay $2 billion to the Central States Multi-Employer Pension Plan as stipulated in its 2007 contract with the Teamsters’ union -- and worse, it will not have to make up the difference to UPS retirees, as mandated in that contract, when cuts take place.

Some conservatives contend that the bill would encourage policy makers to recognize and deal with shortfalls in benefits programs. "Facing up to the insolvency is healthy," said Alex Pollock of the American Enterprise Institute. He added, "While it is difficult considering cutting retiree benefits, it is often better than taking the money from other people, such as taxpayers." Pollack seems to have a short memory of the trillions of taxpayer money used to bail out the banks and financial interests in 2009.

In other words, don't tax the wealthy or close corporate loopholes to make up for the shortfall in pension funding. Take it out of the hides of retirees instead!

Jeopardizes Workers' and the Public's Safety

The bill rolls back safety rules that were supposed to keep sleepy truckers from causing wrecks. The government rules had effectively shortened truckers' maximum workweek from 82 hours to 70, so it's back to 82. That's more than an 11-hour day, seven days a week.

Assault on the Environment

The bill trims the Environmental Protection Agency's budget by $60 million while allowing exceptions to clean water laws for agricultural refuse.

Military Spending Increased Again

The bill devotes 55% of its $1.1 trillion to military spending, which squeezes out other priorities, from education to health care to the environment.

Giving Even Greater Influence to the Superrich

The bill allows political investments (mistakenly called contributions) to political parties. It includes an eight-fold increase (from $194,400 to $1.5 million) per individual over a two-year election cycle to political parties. This makes the Democrats and Republicans even more beholden to the voices and interests of the superrich and less inclined to listen and respond to the interests of low- and moderate-income people.

Shifting the Risk of Bank Losses to Taxpayers

The bill would ease rules enacted to protect taxpayers against bank losses after risky investments helped cause the 2007 financial crisis. Now the banks can resume their high-risk investments under the shield of federal insurance. Sen. Elizabeth Warren urged, "We all need to stand firm and fight this giveaway to the most powerful banks in the country." But far from standing firm, large numbers of Democrats joined their Republican colleagues in approving the bill, which Speaker of the House John Boehner rightfully called bi-partisan and bi-cameral.

The Congressional Vote

The House vote was 57 Democrats and 162 Republicans in favor of the bill, with 139 Democrats and 67 Republicans opposed. So it was 219-206 in favor. In the Senate, it was 31 Democrats, one independent, and 24 Republicans in favor, with 21 Democrats, one independent and 18 Republicans opposed. So it was 56-40 in favor of the bill.

It is often said by some officials in the labor movement that things would be much better if only there were more Democrats in Congress. But what difference would it make? After all, there were more than enough Democrats in the Senate to defeat this massive giveaway to the banks, yet a decisive majority of them voted in favor of the spending bill. Moreover it could not have passed the House without 57 Democrats voting for it. Voting for the bill were Senate majority leader Harry Reid; Sen. Barbara Mikulski of Maryland, who was the Senate's chief architect and promoter of the bill; Rep. Steny Hoyer, also of Maryland, who is the number two ranked Democrat in the House; and Rep. Debbie Wasserman Schultz, from Florida, who is chair of the Democratic Party National Committee.

Procedure

Congress' usual procedure calls for legislation of this type to be referred to the Banking Committee for hearings, with opponents given at least some opportunity to publicize the bill's giveaways to the big banks. However, no such procedure was followed here.
What was critically needed was a national campaign to be launched -- and a mobilization organized by labor and its allies -- to expose the class character of the bill as a boon to Big Business but harmful to the working class majority. Instead, key sections of the bill were written in the dead of night and rushed to a Congressional vote a day or two later. No member claimed that he or she had sufficient time to read, study and analyze its 1,600 pages.

Conclusion

Once again the labor movement is paying a horrific price for its failure to have a meaningful voice in the country's legislative arena. Accordingly, this latest defeat should spur a re-examination of labor's failed dependence on the Democratic Party to look out for workers' interests and why it has become so urgent for labor to break with that dependency. Instead, we should run our own independent labor/community candidates for public office on the basis of a program that faithfully reflects the best interests of the great majority. The failure to adopt such a strategic change will inevitably lead to further defeats for labor in the future.

Issued by the Labor Fightback Network. For more information, please call 973-944-8975 or email [email protected] or write Labor Fightback Network, P.O. Box 187, Flanders, NJ 07836 or visit our website at laborfightback.org. Facebook link: https://www.facebook.com/laborfightback

Donations to help fund the Labor Fightback Network based on its program of solidarity and labor-community unity are necessary for our work to continue and will be much appreciated. Please make checks payable to Labor Fightback Network and mail to the above P.O. Box or you can make a contribution online. Thanks!

[ckaihatsu]

Procedure

Congress' usual procedure calls for legislation of this type to be referred to the Banking Committee for hearings, with opponents given at least some opportunity to publicize the bill's giveaways to the big banks. However, no such procedure was followed here.
What was critically needed was a national campaign to be launched -- and a mobilization organized by labor and its allies -- to expose the class character of the bill as a boon to Big Business but harmful to the working class majority. Instead, key sections of the bill were written in the dead of night and rushed to a Congressional vote a day or two later. No member claimed that he or she had sufficient time to read, study and analyze its 1,600 pages.


I'll note that even *this* treatment is too generous and forgiving -- certainly *any* politician, of any significant experience, would be able to readily ascertain, in a moment's time, what the gist of any given legislation, is, overall.

Does the fault rest with 'labor and its allies' for not-mobilizing a national campaign, or can we squarely put the blame on the members of Congress who at least had a day or two to correctly summarize the legislation as being definitively pro-Wall Street -- ?(!)

[left-of-the-dial]

This is just a bit of frosting on the cake.

The private banks print the money. Any laws about money are basically laws about how the banks money will be spent.

JPMorgan can loan you $100,000 and to do this they only need to have $8,000. They simply electronically create $92,000 and put it in your account. It takes about as much effort to do that as it does me writing this post. Oh and they want this money back with interest even though they created it from nothing.

These banks have got the Government by the bollocks. The Government can't go after the banks because the Banks pay for ALL of Government they print 90%+ of the money lending a substantial amount of it to the Government in the form of bonds. If the government doesn't get this money the country goes bust FAST.

So please don't get your hopes up that the government will listen to any labour movement and reel in the banks because it simply isn't going to happen. The banks and the government are completely co-dependant.


The good news?

Whenever any empire has done this before they collapsed shortly after. The US dollar has been a fiat currency since 1971. The average lifespan of a fiat currency is 27 years. Now this makes it very clear why the Fed is printing endless money. Because the US dollar is worth absolute fuck all now and as soon as these trillions enter the real world (and remember the banks can lend this out 10 times over) the US dollar will collapse.

Keep your chin up buddy there's a complete financial collapse coming (they managed to stall it in 2008 and continued to make the problem far worse) and when that happens that is the time for the Labour movement to rise.

[ckaihatsu]

This is just a bit of frosting on the cake.

The private banks print the money. Any laws about money are basically laws about how the banks money will be spent.

JPMorgan can loan you $100,000 and to do this they only need to have $8,000. They simply electronically create $92,000 and put it in your account. It takes about as much effort to do that as it does me writing this post. Oh and they want this money back with interest even though they created it from nothing.

These banks have got the Government by the bollocks. The Government can't go after the banks because the Banks pay for ALL of Government they print 90%+ of the money lending a substantial amount of it to the Government in the form of bonds. If the government doesn't get this money the country goes bust FAST.

So please don't get your hopes up that the government will listen to any labour movement and reel in the banks because it simply isn't going to happen. The banks and the government are completely co-dependant.


The good news?

Whenever any empire has done this before they collapsed shortly after. The US dollar has been a fiat currency since 1971. The average lifespan of a fiat currency is 27 years. Now this makes it very clear why the Fed is printing endless money. Because the US dollar is worth absolute fuck all now and as soon as these trillions enter the real world (and remember the banks can lend this out 10 times over) the US dollar will collapse.

Keep your chin up buddy there's a complete financial collapse coming (they managed to stall it in 2008 and continued to make the problem far worse) and when that happens that is the time for the Labour movement to rise.


Thanks for that rather... *economistic* take on all of this.... I guess I'll be coming back in off of the window ledge, then. (grin)

I think what tends to keep the U.S. dollar, and the U.S., going, is *international confidence* -- the worldwide situation reminds me of Japan's economic situation domestically, where people just keep saving and plowing monetarist value back into the currency, and especially these days for lack of anything better (except the overvalued stock markets, of course).

The '08 crisis was precipitated by the subprime lending bubble which could be seen as an internal *political* schism that got out of control, and then it was brought back *under* control.

What I'm getting at is that the U.S. continues to enjoy economic and political hegemony worldwide and that exceptionalism is not going to be easily brought down, except by a decisive, definitively *political* domestic / internal situation that would give world investors serious pause.

Since it's obviously a *casino*-type dynamic, as you're pointing out, the roulette wheel will continue to spin as long as people stay and sit, bringing their international funds with them.

[consuming negativity]

for that much money the government could write a check to every american of any age at all (including infants) for 3,000 bucks

that would help my ass out a lot

[Prof. Oblivion]

More right wing libertarian hyperinflation fearmongering. Why is this crap allowed on a leftist forum?

The dollar won't collapse. It never will. Ever.

[ckaihatsu]

More right wing libertarian hyperinflation fearmongering.


Now, in recent times, we have an actual *physical manifestation* of their ideology to dissect and examine: the Bitcoin.

In line with their economic mantra that savers / monetarists should be rewarded (against the 'perils' of hyper-printed fiat money), they've gone so far as to create an alternative currency that is supposed to just exist, hanging in the middle of space like a coat without a coathook.

Let's take a look at its history to-date:


http://bitcoincharts.com/charts/chart.png?width=940&m=bitstampUSD&SubmitButton=Draw&r=1460&i=&c=0&s=&e=&Prev=&Next=&t=C&b=&a1=&m1=10&a2=&m2=25&x=0&i1=&i2=&i3=&i4=&v=0&cv=0&ps=0&l=0&p=0&


Oh, that's right -- without a big bad empire to back it up it's prone to *fucking heists* -- !!! (Google 'bitcoin heist 2013'.)

So as a result of thinking that the economic can be neatly detached from the political we wind up at the predictable: sudden volatility due to economic factionalism based on sheer opportunism -- simple robbery, in other words.





Why is this crap allowed on a leftist forum?


So that we can gain the benefits of innoculation.





The dollar won't collapse. It never will. Ever.


Not so long as there's a U.S. empire in existence to back it, with associated economic minions worldwide.

[PaulBrown]

More right wing libertarian hyperinflation fearmongering. Why is this crap allowed on a leftist forum?

The dollar won't collapse. It never will. Ever.

The dollar will never collapse? Never say never. Look at the russian currency ;)

[ckaihatsu]

---





Would just like to remind everyone of the U.S.'s special 'global protection racket' status:





The essential conflict was that the American role as military defender of the capitalist world's economic system was recognized, but not given a specific monetary value. In effect, other nations "purchased" American defense policy by taking a loss in holding dollars. They were only willing to do this as long as they supported U.S. military policy. Because of the Vietnam War and other unpopular actions, the pro-U.S. consensus began to evaporate. The SDR agreement, in effect, monetized the value of this relationship, but did not create a market for it.




http://en.wikipedia.org/wiki/Bretton_Woods_system#Paralysis_of_international_mo netary_management

[Prof. Oblivion]

The dollar will never collapse? Never say never. Look at the russian currency ;)

The dollar can't collapse like the Rouble did. There's no effective supply shock that would be comparable to what is happening in Russia. Outside of this, the Fed has the reigns on the value of the dollar; the American monetary system has made the prospects of extreme or hyperinflation impossible.

[Vogel]

The dollar can't collapse like the Rouble did. There's no effective supply shock that would be comparable to what is happening in Russia. Outside of this, the Fed has the reigns on the value of the dollar; the American monetary system has made the prospects of extreme or hyperinflation impossible.

Couldn't the debt cause something like it? I know China depends on us as their market, but if they get into enough economic difficulties, then they may start collecting. I don't know if the US would be able pay 17 trillion dollars though, so they might ask for physical assets, then the government will take ownership of these things, say a GM factory or Shell oil well, and promptly sell it.
Point is, it would really strain the US economy and dollar.

[Prof. Oblivion]

Couldn't the debt cause something like it?

No because the debt is always paid off as it comes due. All they have to do is issue more debt.


I know China depends on us as their market, but if they get into enough economic difficulties, then they may start collecting.

China and other US debtholders hold US Treasury Bonds. The bonds are already paid as they become due. Bondholders cannot "collect" on bond payments before they are due.


I don't know if the US would be able pay 17 trillion dollars though, so they might ask for physical assets, then the government will take ownership of these things, say a GM factory or Shell oil well, and promptly sell it.
Point is, it would really strain the US economy and dollar.

The debt never has to be paid off in full, just as the bonds come due, which is never a problem.

[Creative Destruction]

breaking: bears shit in woods.

[contracycle]

Prof. Oblivion, do you also disagree with the point above about the banks ability to issue money, and if so would you explain why?

[Prof. Oblivion]

Prof. Oblivion, do you also disagree with the point above about the banks ability to issue money, and if so would you explain why?

Which post are you referring to?

[contracycle]

That by left-of-the-dial.

Perhaps I'm over-reading it, but it seems to suggest that the ability of the banks to create electronic currency is not only out of the control of the state, but establishes a feedback loop which should drive the quantity of money toward infinity.

[Prof. Oblivion]

That by left-of-the-dial.

Perhaps I'm over-reading it, but it seems to suggest that the ability of the banks to create electronic currency is not only out of the control of the state, but establishes a feedback loop which should drive the quantity of money toward infinity.

The post is inaccurate. Banks can't really create money per se, but they can in some sense by loaning funds out. The reason it really isn't the creation of "new money" is because the expansion of net financial assets still zeroes out (for the bank, the cash commitment is a liability, while the loan principle is an asset - for the customer, the opposite). As Say said, "every sale is a purchase".

In the poster's example, JP Morgan can't simply "create $92,000 [out of nowhere] and put it in your account". In reality, something like this happens, but the money does comes from JPM and not thin air. JPM's "Deposit" account is increased by $100,000 while its "Loans" account is increased by the same amount - the asset and liability balance. When you withdraw the $100,000, the bank's "Deposit" account is decreased by $100,000 as well as its "Cash" account. On the cash flow statement the bank shows cash outflow of $100,000. Following this transaction, at the end of the day, if the bank doesn't have sufficient funds to meet its reserve requirements, it borrows funds on the inter-bank market.

The only way that money is truly created is through government spending. If the government spends money the recipient receives an asset without a corresponding liability in the non-government sector. Likewise, government revenue - taxation - affects the money supply in the same way.

Finally, keep in mind that banks aren't able to just pump money into the economy however they please. They can only supply the amount of money that satisfies the demand for debt. In other words, like any other firm, the bank has an inventory that it's trying to sell (it just so happens to be an inventory of money) and they can only move the inventory if it's priced at a point where there is a demand to purchase it (in this case the price being the interest rate and terms of the debt).

So no, the banks don't have "the Government by the bollocks" as the above poster said. That's right out of the Ron Paul playbook. Further, the banks don't control the government through the holding of US sovereign debt; that notion is just absurd and another right wing extremist viewpoint. The only reason that US sovereign debt exists is because of the separation between fiscal and monetary policy. If the US government set monetary policy there would be no need for the issuance of debt, which is really just a middleman in the money creation process.

[contracycle]

In the poster's example, JP Morgan can't simply "create $92,000 [out of nowhere] and put it in your account". In reality, something like this happens, but the money does comes from JPM and not thin air. JPM's "Deposit" account is increased by $100,000 while its "Loans" account is increased by the same amount - the asset and liability balance. When you withdraw the $100,000, the bank's "Deposit" account is decreased by $100,000 as well as its "Cash" account. On the cash flow statement the bank shows cash outflow of $100,000. Following this transaction, at the end of the day, if the bank doesn't have sufficient funds to meet its reserve requirements, it borrows funds on the inter-bank market.

This distinction doesn't appear meaningful. The $100k previously did not exist, and now it does, all because some jottings were made in a ledger.

That $100k still circulates; maybe it gets used to pay for equipment or wages or whatever. And yet, it was not issued by a government - it exists purely because JP Morgan invented an imaginary asset coupled with an imaginary liability. Lending that money doesn't prevent JPM from lending more money in future - that is, the $100k spending that they record in no way prevents them from lending another $100k, because they can repeat the trick of creating this matched pair from nothing almost indefinitely, limited only by their legal requirements for holding "real" money.

[Prof. Oblivion]

This distinction doesn't appear meaningful. The $100k previously did not exist, and now it does, all because some jottings were made in a ledger.

The $100k most certainly did exist in the economy or the bank couldn't loan out the money.


That $100k still circulates; maybe it gets used to pay for equipment or wages or whatever. And yet, it was not issued by a government - it exists purely because JP Morgan invented an imaginary asset coupled with an imaginary liability.

But JPM didn't create the $100k or any portion of it out of thin air. You're getting confused because JPM credits your account with the $100,000 which appears to be out of thin air but isn't. The deposit account is, to the customer, an asset. To the bank it is an IOU. Essentially your account is one giant IOU by the bank, a liability on its balance sheet. If you take this $100,000 and write a check to someone, and it is deposited in their account, no actual government money has exchanged hands. The banks simply consummate the transaction by reconciling the two banks' various IOU's; your bank's IOU account decreases by $100,000 and the recipient's bank increases their IOU by $100,000. Seemingly, though, your depository account increased by $100,000 which came out of nowhere. That isn't the case.

Let's say for example that you borrow $100,000 to pay the government. The bank increases your depository account by $100,000. You write a check to the government for $100,000. The government "deposits" the check by swapping bank IOU's for Federal Reserve IOU's. In other words, the bank decreases its reserve account by $100,000 (to give to the government) and at the same time decreases your depository account by $100,000. The money is removed from circulation through this payment to the government, but you still owe the bank $100,000. In this instance money has been "destroyed" not created.


Lending that money doesn't prevent JPM from lending more money in future - that is, the $100k spending that they record in no way prevents them from lending another $100k, because they can repeat the trick of creating this matched pair from nothing almost indefinitely, limited only by their legal requirements for holding "real" money.

They most certainly cannot repeat it "almost indefinitely". They have regulatory constraints that they must adhere to, as you have said, but also they must be making loans that are priced for demand and are still profitable, like any business. Again, the demand for debt must be in line with the supply. Finally, banks are capital constrained.

Further, no new net assets are created in the economy by doing this, it is merely a reshuffling of assets. There is no money actually "created" through the process of bank lending per se. Money is only created or destroyed by government spending/taxation.

[contracycle]

Well, ok, then where was it, precisely?

The whole point of those lending restrictions arises precisely because banks DO lend out money they do not have. If we were talking about gold, or even paper currency, the question of capitalization would not arise, because a bank could only lend what it actually had in its vaults.

The very fact that regulations stipulate that a bank must hold X in capital in order to lend out Y, which is some multiple of X, confirms the difference. In a context where money can be created electronically, the banks computers serve exactly the same function as the printing press.

[Prof. Oblivion]

Well, ok, then where was it, precisely?

Bank reserves, which I should specify that they are part of the economy in the sense that they are held by private banks on private bank balance sheets, but not part of the economy in the sense that they are able to be deployed in the "actual" economy like monetarists would argue.

Bank lending is a transmission mechanism for the creation of money, not the source. The only source of money creation is government spending. This gets complicated because of the separation of fiscal and monetary policy which necessitates the creation of government debt. US debt is essentially money, though, with the central bank acting as an administrator of the creation of money in its dealing with bank reserve accounts.

[contracycle]

But "reserves", as I understand the term, does not apply to the principal, but that which is held to back the principle. The reserve is the $8k, not the $100k.

Moreover, you've just detailed yourself that that $100k is created by fiat, within the accounts of the bank. It is not and never was held anywhere.

[Prof. Oblivion]

But "reserves", as I understand the term, does not apply to the principal, but that which is held to back the principle. The reserve is the $8k, not the $100k.

Moreover, you've just detailed yourself that that $100k is created by fiat, within the accounts of the bank. It is not and never was held anywhere.

Okay so let's go through this in a simpler manner.

"Base money" is the sum total of bank reserves and currency. This is money that is on the Fed balance sheet as a liability. Banks are unable to create either of these two types of money (obviously).

Bank reserves are defined as the sum of vault cash plus the value of the bank's reserve account at the Fed. Banks have reserve requirements, which are a percentage of total deposits. In the process of creating a loan, the bank loans the money out and then reconciles its reserve requirements by borrowing or lending on the interbank market. So in that regard, banks aren't reserve constrained.

When a customer deposits cash into an account at a bank, the bank takes the currency and increases its cash account, and also increases the depositor's account as a liability. The money in the depositors account isn't actually money. It is an agreement between the bank and the depositor that the depositor has a claim on the value of the deposit account in "base money" i.e. cash. So money in an account isn't actually money but a contractual agreement, in other word it's basically the depositor lending the bank the money at near-zero interest rate for the advantage of having it secured in a highly liquid asset.

When a customer writes a check on their depository account, the recipient deposits it in their depository account and the two banks clear the transaction. The clearing process requires no exchange of "base money" but rather the first bank decreases its liability to the payer while the second bank increases its liability to the payee. All that has changed is an exchange of liability, essentially of IOU.

When a bank loans money out to a customer, the process is similar but reversed (and more complicated of course). The bank deposits the loaned funds in the debtor's account; the balance sheet adjustments would be an increase in the loan asset account and a corresponding increase in the depository account liability. When the debtor writes a check to another person, the same situation as above happens.

So where did the money come from? That's the big question, right? Well, first off it isn't actually money. It's an increase in the depository account liability. In that sense, the liability did come out of "thin air" in a way, but in a rigorous sense that isn't really true because capital can't be willed into existence. The loan amount is a claim on real money, but isn't money itself.

This sounds silly because if I go to the bank and take out a $100 loan, and withdraw it as cash, it most certainly is real money in my hand. It seems like splitting hairs to define whether or not deposits are "actually" money. This however isn't true if you look at the entire economy.

If one thinks about the entire economy, it's fairly obvious that depository accounts can't be actual money ("base money"), because they are claims on the same pot of money. Bank lending expands the circulation of "base money" but does not actually "create" money. So it is leveraging the base supply but this isn't actually creating new money because, in aggregate, there is one person on each side of the loan in the economy.

As an example, let's say there's $1,000 "base money" in existence, and two banks which each have $500 cash in the vault. I open an account at JPMC and borrow $100. JPMC deposits a $100 into my account at 0% interest. Its balance sheet expands on the asset side by $100 for the loan, and $100 on the liability side for my depository account. Was money actually created? No, JPMC just owes me $100 whenever I request it. There is still only $1,000 in base money in existence. If I withdraw the $100, JPMC's cash goes down to $400, as does its corresponding depository account liability. I have $100 base money, JPMC has $400 and BOA has $500. If I use this money to pay a friend $100, he goes and deposits it in his BOA account. BOA's base money increases to $600, and its depository account for my friend increases by $100.

The situation is the same for if I just wrote a check instead of taking the cash out. I borrow $100 which is deposited into my account. JPMC's balance sheet expands by $100 because of the loan asset/deposit liability, but its base money remains the same at $500. I write a check to my friend who deposits it at BOA. BOA and JPMC clear the transaction, removing the $100 in my account and depositing it in my friend's. However no base money has been exchanged. At the end of the day the total base money is still $1,000.

Yes, at some point in this process JPMC had $1,000 in the vault and I had $100 in my account, but the $100 doesn't count towards actual money because if I withdraw those funds, it comes out of JPMC's $1,000 cash. It's a claim on a portion of JPMC's cash.

That is how the entire banking system works. The actual base money supply can't be expanded by bank lending because it is a system of claims on the same base monetary value. A depository account isn't money because it was issued by a bank. I can't take my depository account and use it to pay for my groceries without either converting it into currency or going through the bank clearing process.