2minutebitcoin on Nostr: Banking is inherently unstable. Bankers are making it up as they go. There are ...
Banking is inherently unstable. Bankers are making it up as they go. There are numerous examples throughout history that prove this, each with different outcomes.
Numerous examples to keep you going:
1. [Cyprus Banking Crisis](https://en.wikipedia.org/wiki/2012%E2%80%932013_Cypriot_financial_crisis) (2013) - Cypriot banks got in deep trouble due to Greek debt exposure, leading to bank runs and capital controls. Uninsured deposits were controversially used to rescue the banks through a "bail-in."
2. [IndyMac Bank](https://www.bankinfosecurity.com/indymac-inside-story-bank-failure-rebirth-a-1432/op-1) (2008) - During the 2008 financial crisis, IndyMac, a California-based bank, saw depositors withdraw over $1.3 billion in just 11 days, leading to its collapse and takeover by the FDIC.
3. [Northern Rock](https://www.suerf.org/studies/2141/the-failure-of-northern-rock-a-multi-dimensional-case-study) (2007) - The first UK bank run in 150 years happened when the subprime mortgage crisis hit, with depositors withdrawing £1 billion in only three days.
4. [Argentine Financial Crisis](https://economics.rabobank.com/publications/2013/august/the-argentine-crisis-20012002-/) (2001) - A huge bank run during the economic meltdown led the government to freeze bank accounts and convert dollar-denominated accounts to pesos, causing many to lose their savings.
5. [Barings Bank](https://www.e-education.psu.edu/ebf301/node/569) (1995) - London's oldest merchant bank went under after rogue trader Nick Leeson caused over £827 million in losses, leading to a run on deposits and the bank's eventual bankruptcy.
6. [Continental Illinois](https://www.atlantafed.org/cenfis/publications/notesfromthevault/1604) (1984) - Risky lending practices led to a bank run and the collapse of the seventh-largest US bank at the time, requiring a massive bailout from the Federal Reserve.
7. [Banco Ambrosiano](https://en.wikipedia.org/wiki/Banco_Ambrosiano) (1982): Nicknamed "God's Bank" due to Vatican ties, Banco Ambrosiano collapsed because of fraud and a run on deposits, leaving a $1.4 billion hole in its balance sheet.
8. [Herstatt Bank (1974)](https://en.wikipedia.org/wiki/Herstatt_Bank) - A bank run on this Cologne-based bank, triggered by massive forex trading losses, led to its collapse. An event widely referred to as the Herstatt crisis, this highlighted the importance of settlement risk in foreign-exchange markets and was a key factor that led to the worldwide implementation of real-time gross settlement (RTGS) systems
9. [Bank of United States (1931)](https://en.wikipedia.org/wiki/Bank_of_United_States) - During the Great Depression, a run on the Bank of United States caused it to fail, making over $200 million in deposits inaccessible for its 400,000+ depositors and worsening the economic crisis.
10. Great Depression Bank Runs (1930-1933) - After the 1929 stock market crash, a series of bank runs swept the nation, [causing over 11,000 banks to fail](https://thegreatdepressioncauses.com/great-depression/banks/) and wiping out about $140 billion in savings (in today's terms).
Numerous examples to keep you going:
1. [Cyprus Banking Crisis](https://en.wikipedia.org/wiki/2012%E2%80%932013_Cypriot_financial_crisis) (2013) - Cypriot banks got in deep trouble due to Greek debt exposure, leading to bank runs and capital controls. Uninsured deposits were controversially used to rescue the banks through a "bail-in."
2. [IndyMac Bank](https://www.bankinfosecurity.com/indymac-inside-story-bank-failure-rebirth-a-1432/op-1) (2008) - During the 2008 financial crisis, IndyMac, a California-based bank, saw depositors withdraw over $1.3 billion in just 11 days, leading to its collapse and takeover by the FDIC.
3. [Northern Rock](https://www.suerf.org/studies/2141/the-failure-of-northern-rock-a-multi-dimensional-case-study) (2007) - The first UK bank run in 150 years happened when the subprime mortgage crisis hit, with depositors withdrawing £1 billion in only three days.
4. [Argentine Financial Crisis](https://economics.rabobank.com/publications/2013/august/the-argentine-crisis-20012002-/) (2001) - A huge bank run during the economic meltdown led the government to freeze bank accounts and convert dollar-denominated accounts to pesos, causing many to lose their savings.
5. [Barings Bank](https://www.e-education.psu.edu/ebf301/node/569) (1995) - London's oldest merchant bank went under after rogue trader Nick Leeson caused over £827 million in losses, leading to a run on deposits and the bank's eventual bankruptcy.
6. [Continental Illinois](https://www.atlantafed.org/cenfis/publications/notesfromthevault/1604) (1984) - Risky lending practices led to a bank run and the collapse of the seventh-largest US bank at the time, requiring a massive bailout from the Federal Reserve.
7. [Banco Ambrosiano](https://en.wikipedia.org/wiki/Banco_Ambrosiano) (1982): Nicknamed "God's Bank" due to Vatican ties, Banco Ambrosiano collapsed because of fraud and a run on deposits, leaving a $1.4 billion hole in its balance sheet.
8. [Herstatt Bank (1974)](https://en.wikipedia.org/wiki/Herstatt_Bank) - A bank run on this Cologne-based bank, triggered by massive forex trading losses, led to its collapse. An event widely referred to as the Herstatt crisis, this highlighted the importance of settlement risk in foreign-exchange markets and was a key factor that led to the worldwide implementation of real-time gross settlement (RTGS) systems
9. [Bank of United States (1931)](https://en.wikipedia.org/wiki/Bank_of_United_States) - During the Great Depression, a run on the Bank of United States caused it to fail, making over $200 million in deposits inaccessible for its 400,000+ depositors and worsening the economic crisis.
10. Great Depression Bank Runs (1930-1933) - After the 1929 stock market crash, a series of bank runs swept the nation, [causing over 11,000 banks to fail](https://thegreatdepressioncauses.com/great-depression/banks/) and wiping out about $140 billion in savings (in today's terms).