Banking panic

A banking rush , or banking panic ( bank run ) is a phenomenon, often car-realizer, in which a great number of customers of a Banque fear that it does not become insolvent and withdraw their deposits from it as quickly as possible.

Not being able to face these multiple requests of withdrawals (the number of people increases hours in hours by Mimétisme), and in the absence of support, the bank runs the risk to become indeed insolvent. This brings into play the cardinal mechanism in finance of a Prophétie car-director.

“The banks and the depositors face problems of coordination of their behaviors which can be dependant either on asymmetries of information and risks of moralities inherent in the decentralization of the decisions, or to structural and lawful characteristics, which explain why the banking system is vulnerable to the rushes of the depositors. ”

When this “race” of the savers relates to a great proportion of the banks, and that the Central bank does not manage to rather quickly provide liquidities to the private banking, the phenomenon can evolve to true a Financial crisis.

Historically, of the episodes of banking panic in particular took place:

during the Great Depression (Years 1930) with the the United States;
at the time of the Argentinian Economic crisis (1998 - 2002); the corralito was used by the Minister for the economy to stop the phenomenon;
in September 2007, a banking mini-phenomenon of rush related to the British institution of mortgage credit Northern Rock, in the context of the Crise of the subprimes.

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