Capital is absolutely not unconstrained! It is one of the most difficult things for a bank to increase its capital base.
Base money is a low percentage compared to bank money - its true - but all bank money is a claim on base money. Pull out the base money and every bank has a liquidity crisis and would in turn have to recall every loan. More than parking meters would feel it; a bank cannot issue a loan without appropriate capital base, and only high quality liquid unencumbered assets can be considered capital, which cannot be created by a bank (a new loan/deposit is not an unencumbered asset). In practice capital can only be increase by a new share issue or by retaining profits over years.
I read the bank underground blog post. It is fine and interesting, but it is talking entirely about bank money creation (loans/deposits) and not about base money or capital ratios. That's OK, no reason for an article to talk about everything. But just because one article doesn't talk about capital in the point it is making, doesn't mean that capital is not an important constraint in banking.
There is a reason why bank CEOs have been in recent years judged heavily on their Tier 1 capital ratios, and why they consider it difficult to adjust these ratios. Issuing a new loan makes the bank's capital ratio worse not better.
Base money is a low percentage compared to bank money - its true - but all bank money is a claim on base money. Pull out the base money and every bank has a liquidity crisis and would in turn have to recall every loan. More than parking meters would feel it; a bank cannot issue a loan without appropriate capital base, and only high quality liquid unencumbered assets can be considered capital, which cannot be created by a bank (a new loan/deposit is not an unencumbered asset). In practice capital can only be increase by a new share issue or by retaining profits over years.