Bank Runs
About an hour after the south tower of the World Trade Center collapsed, I walked to the one ATM in the Carleton University student centre and withdraw my daily maximum — $500. I didn’t really think much about it, but an instinct seemed to kick in that when it doubt, don’t keep your money in a bank. I didn’t know to what extent 9/11 was going to play out that day and the reports off terrorist attacks were all over the place.
The instinct might have been honed by our prep at home for Y2K. While no calamity occurred on Friday, December 31, 1999, the bathtubs in our house were filled with water and we had a kerosene heater, fuel, and food ready for a few weeks if society crumbled around us.
Hearing about the SVB collapse reminded me of that time. Will this be contained? Will it be the start of global financial meltdown? The end is nigh? We’re likely becoming more stable than not as a society but it doesn’t help when a disaster hits you.
It’s hard to know what the long term consequences of bailouts/aid are over a multi-decade period, especially when they are piled on after another. Does it make the system less resilient?
From an optimist’s viewpoint, I can see that the goal is just to keep things going long enough to get to another bridge. Can the economic growth start up again in time for any consequences to take hold? It’s the same for the startup or even one looking at longevity wellness — bridge to a bridge to a bridge to a… At some point, we run out of bridges. The optimist will hope that at that point, we’re in the Promised Land, however, we define it.
