Difference between revisions of "Bank run"
Jump to navigation
Jump to search
m (added extra sentence; alphabetized 'See also' list) |
DavidB4-bot (talk | contribs) m (→top: HTTP --> HTTPS [#1], replaced: http://books.google.com → https://books.google.com) |
||
| (5 intermediate revisions by 3 users not shown) | |||
| Line 1: | Line 1: | ||
| − | A '''bank run''' is a series of unexpected large cash withdrawals from a [[bank]] caused by a sudden decline in depositor confidence or fear that the bank will be closed by the chartering agency, i.e. many depositors withdraw cash almost simultaneously. Since the cash reserve a bank keeps on hand is only a small fraction of its deposits, a large number of withdrawals in a short period of time can deplete available cash and force the bank to close and possibly go out of business. Bank runs are a risk for every bank that operates under a [[fractional-reserve banking]] system.<ref>Mankiw, N.G. [ | + | A '''bank run''' is a series of unexpected large cash withdrawals from a [[bank]] caused by a sudden decline in depositor confidence or fear that the bank will be closed by the chartering agency, i.e. many depositors withdraw cash almost simultaneously. Since the cash reserve a bank keeps on hand is only a small fraction of its deposits, a large number of withdrawals in a short period of time can deplete available cash and force the bank to close and possibly go out of business. Bank runs are a risk for every bank that operates under a [[fractional-reserve banking]] system.<ref>Mankiw, N.G. [https://books.google.com/books?id=58KxPNa0hF4C&lpg=PA353&dq=bank%20run%20fractional-reserve%20banking&pg=PA353#v=onepage&q=%22bank%20runs%20are%20a%20problem%20for%20banks%20under%20fractional-reserve%20banking%22&f=false ''Principles of Macroeconomics'']; South-Western Cengage Learning; Mason, OH. Page 353, (2008)</ref><ref>http://usinfo.state.gov/products/pubs/oecon/chap12.htm</ref> |
==References== | ==References== | ||
{{reflist}} | {{reflist}} | ||
| − | |||
| − | |||
| − | |||
==See also== | ==See also== | ||
| Line 15: | Line 12: | ||
* [[Panic of 1907]] | * [[Panic of 1907]] | ||
* [[Recession]] | * [[Recession]] | ||
| + | |||
| + | {{Economic preparedness topics}} | ||
| + | |||
| + | [[Category:Economic Preparedness]] | ||
| + | |||
[[Category:Business]] | [[Category:Business]] | ||
| − | [[Category:Economic | + | [[Category:Economic History]] |
Latest revision as of 13:41, September 26, 2018
A bank run is a series of unexpected large cash withdrawals from a bank caused by a sudden decline in depositor confidence or fear that the bank will be closed by the chartering agency, i.e. many depositors withdraw cash almost simultaneously. Since the cash reserve a bank keeps on hand is only a small fraction of its deposits, a large number of withdrawals in a short period of time can deplete available cash and force the bank to close and possibly go out of business. Bank runs are a risk for every bank that operates under a fractional-reserve banking system.[1][2]
References
- â Mankiw, N.G. Principles of Macroeconomics; South-Western Cengage Learning; Mason, OH. Page 353, (2008)
- â http://usinfo.state.gov/products/pubs/oecon/chap12.htm
See also