The Money Multiplier

This article shows a great graph representing the precipitious fall of the money multiplier. This is the true problem, since as the graph shows the money multiplier is under 1, meaning for everyone one dollar increase in checkable deposits, M1, a particular measure of money supply, only increases by a fraction of any deposit. 

This is clearly something that is plaguing our economy, and if banks were more willing to "create" money and loan out more money, banks would not only make much more money, helping their own cause, but also would help the economy move forward with increased Gross investment.