I was reading Frosti Sigurjonsson's proposal for monetary reform in Iceland. [Click on the document thingy halfway down the page.] His proposal is a variant on 100% reserve banking. I got stuck on page 72 and footnote 66, where he discusses overdrafts.
This post is just my attempt to get my own head clear on some of the questions this raises. My head is not 100% clear yet.
(Iceland's financial crisis was much worse than other countries', which concentrates their minds to consider radical reforms. But it would be wise for all countries, and that includes Canada, to keep at least one eye on the possibility of radical reforms. We don't really know why Canada has been relatively "lucky" so far.)