What Do The Experts Say?

The most thorough going, and most beneficial, reform of Canadian banking would be for the Bank of Canada to buy back from the Chartered Banks all federal debt they hold, plus sufficient other assets to equal 100% of their demand deposits (M1a) liabilities, and then require them hence forth to maintain 100% reserves against all deposits transferable by cheque. At one stroke this reform would end our present fractional reserve or "private mints system" by which the banks create 95% of the money we use as they make loans. The Bank of Canada, or the Department of Finance, if this were desired, would then become the sole creator of money and the private banks would be reduced to their role of re-lending savings deposited with them without money creation.