To be honest I know very little about GATA, other than what it is and what it stands for ... The term fractional reserve is also new to me. Maybe I've been living in a closet too long. Portee, pass me some ripple!! ... please :)

Nevertheless, it would seem that "fractional reserve" is some sort of conspirators speak (or government speak?) for "Margin"? It should also be noted that the very notion of reserves of any kind is that a portion of the asset is backed in case of the worst probable scenario. This is where actuaries make there money. If insurance companies were forced to back there potential claims dollar for dollar, they'd be broke, however after 2008 many, if not all significantly changed their outlook on market probabilities.

Why would anyone want to own a pile of shiny metal that sits in a vault somewhere across the world if they were not able to leverage it to some extent? I'd rather own an antique clock.