The actual process was the series of bank runs that happened through the early 1930s.
Similarly, all existing bank deposits in euros would be maintained in euros, preventing bank runs.
Crisis countries remain highly vulnerable to bank runs, debt downgrades, deepening recessions and political instability.
We can see that this is a system likely to be exposed to bank runs.
FORBES: What Caused The Great Financial Crash: Gary Gorton Is Right
Now the fund was set up during the Depression as a way of stopping bank runs.
Hong Kong has experienced bank runs before, most recently in 1997 during the Asian financial crisis.
Further, Italy and Spain could suffer bank runs that could exacerbate the bloc's pain.
So, we had a problem, bank runs, brought on by the simple nature of fractional reserve banking.
Modern bank runs stem from people pushing buttons to execute electronic withdrawals of large amounts of funds.
FORBES: Cyprus Deposit Levy: No Panic Yet But Scary Long-Term Consequences
While the crisis has precipitated bank runs in Cyprus, depositors elsewhere seem to have remained remarkably calm.
FORBES: The Cyprus Bailout Fiasco: European Markets Roll With the Punches
That could make it harder for banks to claw back pay if a bank runs into trouble.
Main point: there are more bank runs (in the fiat-sense of the term) than you can count.
FORBES: How Does The Current Economic Recession Compare To The Great Depression?
And a common deposit-insurance fund could also credibly reduce the risk of bank runs in vulnerable countries.
This is simply true of any system of fractional reserve banking and is the cause of bank runs.
One of the major attractions is that a eurozone banking union would avoid investor flight or bank runs in one country.
Which could cause bigger bank runs than if the Cypriot transition goes badly?
FORBES: Links 17 March: Cyprus Bailout And Predictions Of Disaster
The worry of bank runs across Europe lies at the heart of the concerns in markets at the moment.
Still, the failure of its banks could trigger massive bank runs in Greece.
That made them more vulnerable to panics which, like bank runs, are self-fulfilling.
Bank runs, treaty repudiations and rumors are not the stuff of stable markets.
FORBES: Advisor Loses Sleep Over Bond Market; Thinks You Should Too
Again, there would be bank runs in Europe as depositors fled weaker countries, leading to the reintroduction of capital controls.
Usually, these things happens in what seems like moments (traditional bank runs) or on the scale of eons (the Cambrian explosion).
FORBES: Reinhart and Rogoff; and The Dangers of Tipping Points, Real and Otherwise
Banks, simply because of fractional reserve lending, are vulnerable to bank runs.
Here is the big imponderable: what will the ECB do at the moment that a big bank runs out of unencumbered assets?
Cyprus is a small nation but news of bank runs at Bank of Cyprus and Laiki Bank spread like wildfire, bringing down global markets.
FORBES: EU Takes Shot At Moscow With Cyprus Bailout As Russians Own 22% Of Deposits
The prospect that one country might break its ties to the euro, voluntarily or not, would cause widespread bank runs in other weak economies.
The future governor of the Bank of England (BoE), Mark Carney, has not ruled out changes to the way the bank runs monetary policy.
BBC: Future BoE chief Mark Carney sees 'merit' in policy debate
Given that around 30% of deposits are held overnight, any plan to inflict haircuts would need to be hatched in secret to avoid bank runs.
Other depositors became alarmed that they would lose their money if their banks failed, too, leading to further bank runs, propelling a frightening downward economic spiral.
With Spanish banking woes so prominent (see article), there is a danger of bank runs as citizens of vulnerable economies fear ending up with devalued deposits.
ECONOMIST: How much do Greece and the rest of Europe stand to lose?
应用推荐