Ralph manages to propose full reserve banking without mentioning "full reserve" by marshaling some provocative points. With the huge level of private debt overhang that Steve Keen has been going off on for some time, it seems clear that there is too much credit being extended for the system to bear even if the lending were prudent, in that an exogenous shock to the system could bring down the house of cards in a debt-deflationary spiral.
Read it at Ralphonomics
The root cause of Spanish banking problems
by Ralph Musgrave