Why would anyone want to engage in fractional reserve banking? Because the profits can be immense. Why don't they keep more reserves on hand? Because that reduces the profit potential. And some banks are indeed more restrained that others -- are less, shall we say, extended, than others and do have larger reserves. Eventually, there were (pretty modest, like 10 per cent.) reserve requirements imposed on banks in hopes of preventing the recurring "panics" that had ruined many an innocent man, but these requirements have varied and banks still go bust. And parts, at least, of this parasitic overclass buy legislators and get "bailed out" when needed. Nice work if you can get it -- provided you have a brain too small to understand that you are engaged in predatory fraud, or a conscience atrophied enough that you don't care.