reserves. Countries like Canada have gotten along for years (and, I might add, did much better in the current financial crisis) with a 0 reserve policy. One of my favorite statements of Warren's on this: "It's not some sort of special law that gives banks the power to create money; it's just accounting." The problem is that many of these frauds help the politicians. In fact it helps politicians on both sides. Republicans like the fraud that SS is running out of money because the people credit Democrats for the creation of the program. The democrats like the fraud because it fools people into thinking that SS is a retirement program that they paid into and so they deserve the SS checks making it difficult to touch the program and the people like the program and give credit to the democrats. Consider that SS is far less progressive than the income tax and yet if you propose to the democrats that you eliminate the FICA tax make SS a welfare program that pays out the same amount to rich or poor those defenders of the poor will fight you tooth and nail. They love the fraud! The politicians are like mirrors to the people if the people believe the fraud the way to get elected is to go along with the fraud. I wonder what your take is on the argument that if you increase the base money that once banks start to lend again, you will need to gather