It is universal that banks use deposits for lending and make money in the form of interests.
My query is if bank utilising the deposit for lending,why it isn't reflected in depositors account? Say for example there are ten accounts with balance of ten dollars each and bank lends fifty dollars loan, it is as good as saying it is transferring five dollars each from account holders to the borrower. But reality is account holders when they check their balance amount it would still be ten dollars available for withdrawal for all accounts.Isn't it something abnormal?
Most of last minute bank collapse happens wherein account holders think their money is safe but on one fine day bank block the withdrawals.
If bank account reflect real share of money available with bank for withdrawal, account holders can understand real position of bank to honour the withdrawals at any given time.
Edit: “The banking industry is the circulatory system of the economy,” Mr Gordon says. “It’s analogous to the heart. Breaking your arm is unpleasant – it takes awhile to recover but eventually you’re as good as new. If your heart fails, you’re in trouble.” from History: Banks are at the heart of capitalism https://www.ft.com/content/63e4d792-f111-11df-bb17-00144feab49a
But the fact is money that goes out of the system can be analogous to blood donated by the person.It must be the person's choice to donate if he wants to donate instead of forced blood donation.