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infospace: process book-2-chapter-02

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Extract entities, map to VSM, and synthesize analysis.
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<!-- generated: provider=openrouter model=arcee-ai/trinity-large-preview:free date=2026-02-19 source=book-2-chapter-02 -->
# Requisite Variety in Banking
## Definition
The principle that banks must maintain sufficient reserves and prudent lending practices to match the variety of demands placed upon them. This ensures stability and prevents the excessive circulation of paper money.
## Source Chapter
Book II, Chapter 2
## Context
Smith applies the concept of requisite variety to banking operations, arguing that banks must maintain appropriate reserves and lending practices to remain stable. He shows how failure to maintain requisite variety leads to banking crises.
## Economic Domain
Regulation
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