I am one of those people who see the inherit problem in fractional reserve banking, especially as currently practiced in the U.S. Our governments borrow massive amounts of money, creating inflation with the added burden of interest. At least inflation under a fractional reserve system would be interest free.

What causes these boom and bust cycles in the first place is the disconnect between money and wealth. People forget that money is supposed to be a way of trading wealth, money is not wealth. Creating money without the backing of real wealth causes instability. To be specific, home loans were given to people who lacked the wealth to pay for the loans. There was no real wealth to back up all the money that was being created by these loans. There was no foundation.

You say "We could have avoided the recessions after the financial crisis if US and European governments had created money for spending on infrastructure." That is not only more of the same problem, it's putting the cart in front of the horse. Creating money that is supposed to represent wealth before creating the wealth is what caused the financial crises to begin with. Also, creating infrastructure is of limited use. If the current infrastructure is adequate, then creating more is a misuse of labor and resources. (Labor and resources are both forms of real wealth.) All it would have done is create a temporary and false drop in unemployment, a political feather in Obama's hat. It would have cost us all in the long run when those jobs and that fake inflation causing money ran out. Unemployment would have risen again and we would have had unneeded infrastructure that would give no return on investment.

Read "Economics in One Lesson" by Henry Hazlitt to understand the problem of make work policies more fully.