I'm of two minds about 100% reserve banking. I lean towards it, but I can sympathize with the argument that fractional-reserve banking should be permitted as long as there is full disclosure to the customer. Let the market decide.
Actually, a system where both options are available would be ideal. Government guarantees for deposits should end, of course (they just print the FDIC money anyway).
People should realize, too, that full-reserve banking would mean that a bank's customers would pay the bank to hold their money. Come to think of it, that's not so different from what we have now.