No; but I would say that the 100 per cent system would meet the objection which the minister has raised.
I would advocate the 100 per cent system so far as current accounts are concerned, but not as regards savings accounts, which should be
treated the same as any other investment. Money in savings accounts should be treated as an investment and as the property of the bank. I would apply it as Irving Fisher and Babson's advocate, and use it only in so far as current accounts are concerned. The banks would still have their savings accounts to lend from, if they need more money to put into circulation they can borrow money from the Bank of Canada at a nominal sum and then lend it at a higher rate. They would, however, be in a position to expand their loans only provided the Bank of Canada gave them authority. Unless they got the money from the Bank of Canada they would not be able to expand their loans. In that way the government would have effective control over the volume of money in circulation.
You do not, however, have to go as far as the 100 per cent system. Increase the cash reserve requirements of the chartered banks to the extent necessary to prevent an expansion of loans. If they were at the time operating on a ten to one basis, for example, you could increase the cash reserve requirements of the banks to the extent necessary to prevent them from expanding their loans on the basis of their increased cash reserves.
Subtopic: PROVISION FOR GRANTING TO HIS MAJESTY AID FOR NATIONAL DEFENCE AND SECURITY