• 208. (1) A bank shall maintain a primary reserve in the form of:

1. coins with a face value of two dollars or less that are current under the Currency and Exchange Act,
2. Bank of Canada notes, or
3. deposits in Canadian currency with the Bank of Canada, and such reserve shall not be less on the average during the month than an amount equal to the aggregate of
4. ten percent of such of its deposit liabilities as are Canadian currency demand deposit liabilities,
5. two per cent of such of its deposit liabilities as are Canadian currency notice deposit liabilities.

This lowering of the reserves will mean that the banks can issue at least 25% more money than they were able to issue under the 1967 BANK ACT. This increase will be needed to replace the money withdrawn by ever-increasing interest, repayment of loans, and to make up for the extra money needed because of inflation. This of course will increase bank profits.

Bankers and their government supporters will say that many of these criticisms of the reserve system are no longer valid because of 1991 changes to the Bank Act. However, the changes are for the worse! Perhaps the greatest tragedy that has happened to our country since the fourth edition of Billions for the Bankers - Debts for the People is the change in the new Bank Act. The private chartered banks have won a major battle. Under the 1967 Bank Act, the Minister of Finance had the power over the governor of the Bank of Canada to reduce or increase the fractional reserve of the private chartered banks, thereby increasing or reducing the money supply. Under Sec. 457 of December 1991, the Minister of Finance has lost this power by the elimination of the fractional reserve system. This is not all. Under Sec. 410 and Sec. 434 the private chartered banks are given the following additional powers:

• Sec. 410

1. act as a custodian of property; and
2. act as receiver, liquidator or sequestrator

• Sec. 434 (2) Nothing in any charter, Act or law shall be construed as ever having been intended to prevent or as preventing a bank from acquiring and holding an absolute title to and in any mortgaged or hypothecated real property, whatever the value thereof, or from exercising or acting on any power of sale contained in any mortgage given to or held by the bank, authorizing or enabling it to sell or convey any property so mortgaged. These changes in the Bank Act have given the banks a complete right over our money supply. And, unless this power is restored to Parliament and the Banks put on 100% reserve, all talk of democracy and sovereignty of Parliament is truly idle and futile. You may ask why the banks do not show more profits if it is such a lucrative business. Of course they do show tremendous profits year after year. They have been showing an increase of profits of anywhere from 20 to 35% for a number of years. But not all the profits of banks are reported.