Economic policy doesn't seem to subscribe to the same rules for causality as the rest of the universe. It's not so simple to say "this, because of this" when everything is bound up in tight feedback loops.

Banks lend more when the Fed creates more reserves, and the Fed creates more reserves when banks lend more. And also the opposite.

Looking at it at a time-fixed instant, the amount that banks lend is a multiple of the reserves they have, equal to the multiplicative inverse of the reserve requirement. If any one factor adjusts, one of the other two must likewise adjust to compensate, at a later time. If one member bank independently decides the money supply needs to be bigger, and lends more, and borrows more Fed notes as the banking reserves, yes, the Fed will probably just virtually print more virtual notes and transfer it to the bank's reserve account. But it also might say, "whoa, there," and also increase the interest rate on the loans it makes to member banks, thereby saying, "we don't actually want to increase the money supply that much".

If the Fed decides the money supply needs to expand by 1%, they can't just print up new notes equal to 1% of the current money supply. They have no way to get them into circulation directly. They generally only lend new notes to banks, for use as reserves. And whatever banks borrow as reserves get multiplied as loans. If the reserve requirement is 10%, the Fed could print 0.1% of the existing supply, lower its lending rate to -0.01% so banks will actually borrow all the new notes, and then banks might lend based on that to expand the money supply to the target amount.

But the banks also might just sit on the reserves and collect the -0.01%.

So the interest rate the Fed charges to banks is also involved. Too high, and the reserves the Fed created won't be borrowed at all. Too low, and the banks have less incentive to actually lend on those reserves.

Deciding on the correct amount of fiat to be in existence is a bit of a balancing act, when part of your system is built around allowing all banks to cheat by exactly the same amount.

If the reserve requirement is 100% or higher, nobody can lend what they don't have, so that mushy multiplier goes away, and the Fed needn't worry so much about what the member banks are doing or not doing. But then the banks would be pissed about losing their license to print money, and would probably find some other way to cheat, that the Fed doesn't know about.

These are all factors that encourage various political types to jump onto things like e-Gold or Bitcoin with both feet, without hesitation. The Fed system has banker graft built into it. The hates-the-bankers groups are fine with fiat, as evidenced by support of Bitcoin; they just don't want greedy bankers able to manipulate the size of the money supply for their own profit. They haven't exactly thought through much of the rest of it, but screw those greedy bankers, right? It turns out that when you establish a monopoly on scamming, each of the monopoly cartel's scammers get more unearned money, but less money is sucked out of the economy by scams in total. Who knew? The shitty Fed system is less horrible than the open-market alternative. It's like the Thieves' Guild in Ankh-Morpork. As long as you pay your monthly mugging and burglary franchise fee, you won't get your stuff stolen at random.