Werner is not correct about everything, but he does make various good points.
He posits fractional reserve banking & credit creation as opposite theories, when in fact fractional reserve explains how and why the credit creation is legally and economically possible.
He mis-represents the fractional reserve theory as banks giving you a portion of their reserves, when this is not the case. The banks create "money" out of nothing, but the reserve (and other regulatory) ratios dictate how much they may create.
He claims that credit creation for business activity is not inflationary and does not cause the boom-bust cycle, but he is wrong. The so-called Austrian School explains how and why this happens, and can point to historical episodes in which long-term business spending was characteristic of the boom & followed by a bust.
He claims that mass currency-printing by the central bank is not inflationary because "money" is "really" created by the commercial banks. This compounds with his mis-understanding of fractional reserve banking, such that he doesn't understand the money multiplier effect.
To wit: When there is a fractional reserve, credit creation occurs, up to a limit determined by the reserve ratio. A bank can lend out (a volume equal to) 90% of its deposits if it has a 10% reserve ratio, and most of those lent deposits will be deposited at other banks and "lent" again, multiplying the total credit in the system.
When the central bank engages in money printing, it adds currency to the banking system which is then multiplied by the commercial banks. Werner is right that almost all the credit creation happens in the central banks, but somehow fails to understand that central bank credit creation allows the commercial banks to expand their credit. This lack of understanding is why Werner can insist that "Quantitative Easing" (central bank credit creation) is not inflationary and has "literally zero cost".
The idea that any alternative is a totally free fix and has zero downside should set off alarm bells, and in a trained economist (eg me) it certainly does.
