I think I finally deciphered what you're getting at. The problem is that the problem you're describing is not fractional-reserve banking. It's excessive leverage.

If a bank accepts $100 in deposits and loans $90 of it, and accepts interest on that loan, it is not "creating" money. It is performing fractional-reserve banking.

However, if a bank accepts $100 in deposits and loans $110 of it, it is "creating" money. But that's not a feature of fractional-reserve banking. This is only really possible when trading debt directly, because if you were required to purchase a commodity, a payment is required. (Think of a mortgage. The bank loans you money and they give you, or, really, the seller, actual dollars. Yeah, it's usually a check, but you could go trade that for real greenbacks.)

But fractional-reserve banking is irrelevant to that. In fact, banking is irrelevant to that. Microsoft could, for example, decide to start making loans out of its cash reserves, and end up loaning more than it really has, but in no way is it a bank.

This is really the commercial equivalent of "You know I'm good for it." Yeah, an institution might have enough money to cover that individual debt, but you don't know how many other debts they owe, nor the likelihood of them getting returns from those debts.

This isn't a fractional-reserve banking problem, it's a regulation problem. If all loaning institutions were required to detail all of their loans, then there would be no opaqueness that prevents entities from seeing the risks involved. But the government continually removed transparency from the banking industry over the last 15 years or so, to the point where there were certain markets that couldn't be viewed at all, like the credit default swap market.

So I agree with you that this sort of supremely risky loaning should be curtailed. I totally disagree with your conclusion that the Federal Reserve Act and fractional-reserve banking have anything to do with it.