Deposit insurance is (a form of) credit insurance

If a bank can't fail then the reason for this is that it is guaranteed by the state. The name of this insurance is usually 'deposit insurance' which sounds more benign than credit insurance. The term 'credit insurance' gets closer to elucidating (clarifying) the nature of the problem with the banking system. If credit (of any organisation) is guaranteed then this leads to inflation of the money supply. The term deposit insurance tends to refer only to banks but the problem would be the same if the credit of any firm is insured... it is not because the agency is acting as a bank that there is a problem. A deposit is only one kind of credit which is specific to banks so the complaint (or contradiction) is the 'insurance' not that the credit is a deposit and has been issued by a bank.

Not all counterfeiting is illegal

The nature of fractional-reserve banking is that banks (and their customers) are able to inflate the money supply and increase nominal prices. There is a difference between broad money and narrow money and the difference is that broad money is issued by the (state-guaranteed) commercial banks unlike narrow money which comes from the central bank. Without the state guarantee the commercial banking sector would not be able to issue money because unfunded liabilities would have no value. It is because the government is standing behind the banks that their (excess) credit has value equal to that of normal money. So when a bank issues a loan (or a mortgage) new money is being created and the bank together with the customer is increasing the money supply. And because it is the customer who initiates this arrangement then it is they who are in fact causing inflation. This a legal form of counterfeiting and so then people who borrow money are counterfeiting the currency. So then is it not always illegal for citizens to counterfeit the currency they are able to do so when they get a loan from a (state-guaranteed) bank. Counterfeiting is not always illegal since it is legal to borrow money from insolvent (state-guaranteed) banks.