Sandbox solves this

Here is the usual bitch about central banking.  First, creating money out of thin air.  This happens because central banking lets the member bank create both the debt and asset entry.  In the sandbox, the debt is created, then all member banks have an opportunity to cover the debt.  To the extent that the new debt is not covered, the pit boss will raise the rate, ex post.

This also eliminates first access to money because the sandbox allows free entry and exit, making the first access a priceable risk. After these two problems are solved, the fractional reserve issue is moot.

However, what sets in motion these cycles is not fluctuations in the growth rate of money supply as such, but the fluctuations in the growth rate of money supply generated out of “thin air.” By money “out of thin air” we mean money that is created by the central bank and amplified by fractional reserve lending by commercial banks.An increase in the money supply out of “thin air” provides a platform for non-productive activities, which consume and add nothing to the pool or real wealth. Money out of “thin air” diverts real wealth from wealth generators to non-wealth generating activities, thus weakening the wealth-generating process.The diversion occurs once various individuals that are the early receivers of this newly created money are exchanging new money for goods and services by contributing nothing to the pool of goods and services. Wealth generators that have not received this newly printed money discover that they can now secure fewer goods than before. (The increase in the prices of goods and services manifests this.)