Bank-Run Risk in the Shadows?

We learned about bank panics and their consequences in the series of lectures on the Great Depression. During a bank panic, depositors rush to get their money back from a bank because they are scared that the bank is going to fail and they will lose everything. The lack of FDIC insurance meant that the first depositors to get to the bank were the first and perhaps only depositors to get their money back. It is understandable how this could create hysteria. An article I read stated that, “Bank runs aren’t a relic of the 20^th century. In fact, they risk becoming a hallmark of the 21^st-though with a twist.” The author of this article points out that although you will not see a line of fearful depositors in this century, the same notion holds true for lenders demanding their money from financial institutions. Bank panics are still common during our current financial crisis, they are just harder to notice in this technological era.

http://online.wsj.com/article/SB10001424052970204397704577074782946096256.html