This effectively eliminates the possibility of Fractional Reserve Banking. Who in their right mind is going to give their bitcoins to a bank that turns our around and lends them to other people and makes bets in the stock market with them? Nobody.
What you think?
I think you under estimate the apathy of the general public. They don't care what the banks do to them or their money, just like they don't care what their government does with their taxes.