There is no free market in banking. How fractional reserve banking is held up:

1. Make it policy to inflate the currency. The higher the better.

2. Make bank bailouts federal policy.

That’s it. Sure it helps to make full reserve banks illegal. But if you can print money to bail out fractional banks (which is happening over and over) and guarantee whatever deposits, you make full reserve banks impractical and cement the monopoly via fractional fraud.

I used to think the Fed banned full reserve banks in fear of deposits rushing into them, but it’s actually counter productive. They should allow them to fail, because the fraud won’t allow free banking to compete.

H/T Saif for making me realize this. And Stephan Kinsella: https://www.stephankinsella.com/2016/01/the-great-fractional-reservefreebanking-debate/