Keep in mind that what allows fractional reserve is lack of competition (a company could profitably differentiate itself from competitors by maintaining transparency), and what causes lack of competition is government regulation. In a completely unregulated market, fractional reserve is a non-issue because there is no possibility of monopolistic privilege for any one company or cartel.
You're wrong. What allows fractional reserve banking is the same thing that allows almost everything else in this world -- wealth. Regulation only tries to make sure that the stealing is kept to a reasonable & sustainable level. Without regulation, scammers and parasites multiply 'til there's nothing left to steal -- see bitcoin "investment" for edifying examples.
On a sidenote: Getting rid of corrupt cops doesn't get rid of crime, it only changes the ones who get to commit it.
Notice I said
government regulation. Free-market forms of regulation can and will happen, such as agencies whose job it is to monitor firms on their transarency, etc. The difference is that free-market "regulation" doesn't create monopolies, because it cannot create barriers to entry. That means no outrageous levels of fractional reserve - a non-issue.
Please understand that the government is a form of regulation created by the free market.
The government was not thrust upon mankind by aliens, it didn't instantly materialize from a Bureaucratic Big Bang -- it is the net result of people, and the free market, trying to regulate themselves. It happened to be so fabulously adaptive & successful from the evolutionary & socio-Darwinian perspectives, that it is now pandemic.
Way to go, Invisible Hand.
The free market created fractional reserve banking -- it was created when the first goldsmith/money changer realized that he could write more IOUs than he had gold in his vault. A no-brainer, really.
Fractional reserve banking predates any form of regulation, especially government.
For the wikipedos & men who love them: "Fractional-reserve banking predates the existence of governmental monetary authorities and originated many centuries ago in bankers' realization that generally not all depositors demand payment at the same time.[4]" --wikip.
Understand what it is you're against before speaking out against it, pl0x.