The real issue I have with our current system, besides complete loss of control over debt by our government and Fed, is the concept of fractional-reserve banking.
It obviously encourages "creative investing" (e.g., SDOs & etc.), and truly allows for money creation out or "thin-air". Credit cards represent another 1-2 trillion dollar money creation scheme - which if payed off at once would collapse the entire system.
Fractional-reserve banking is the Achilles heal of our current monetary experiment, along with the critical need to maintain data automation.
And since even systems based on actual precious metal coinage eventually failed, due to debasement, how much longer will our fiat money survive?!
Speaking of survival, since we now live mostly in specialized societies worldwide, failure of our monetary system, or lines of communication, will mean millions, perhaps billions will die.
The "uncivilized" and well-to-do/prepared only left to continue our species.
Currency refers to a component of the M0 or M1 money supply, and does not depend on any loans for expansion or contraction.
Other types of loans do expand the "overall" money supply - but are future labor obligations on specific people or organizations - rather than the general citizenry like treasury security backed currency.