Quote:
Originally Posted by lendaddy
Is it really a run on a bank? I mean in my every-man terms that is when people drain an institution through withdraws. This isn't quite the same.
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Yeah, it's really a run on the bank. People don't literally drain every penny from the bank, I don't think that is logistically possible, and a good portion of the population is always asleep at the switch.
But banks need to maintain certain debt/equity type ratios, etc., and if a bunch of people start taking out money, and deposits start to dry up, it's still a "run" on the bank, and it is what eventually causes them to be shut down.
My aunt and uncle have over $2 million at IndyMac!