The problem would appear to be the small issue of the fraction in the fractional reserve system or in other words, the difference between the amount of real money the US government has to hand and the amount of monopoly money created by the banking system
The key point of Russell's essay can be summed up in the following paragraph: "I say fantasy because the central banks are able to create money at will, with no discipline to stop them. This I believe - is immoral, even evil. The current system allows a central bank to create money out of nothing - whereas I and my fellow Americans have to work for that same money." This process of creating "money out of nothing" is made possible by fractional reserve banking. As its name implies, banks keep a reserve, i.e., assets, for only part of their liabilities. For that portion for which they don't keep a reserve, they can create money (i.e., bank liabilities) out of nothing.
I’ve been trying to catch up on the fractional-reserve system and make my own mind up where I stand on it. Tricky really as aggressive growth does look good when it works…
While wikipedia often fails in the accuracy stakes, its talk pages are a great window into the sides of a particular issue. The wikipedia talk page on the FRS is just that.