Bank runs are truly fascinating, not just from an economic perspective but from a psychological one as well. A bank run can even turn a seemingly healthy institution into an insolvent bank.
Due the the fractional reserve banking system I've covered in another video, pretty much all banks would become insolvent during a bank run if let's say 1 out of 3 depositors demands physical currency.
Let's take a close look at bank runs and see how banks can become insolvent and fail if a "perfect storm" bank run situation arises.
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