It's A Wonderful Life Bank Run
Why Hacker News recommends it
Used as a classic analogy for fractional reserve banking and bank runs.
What it is
The bank run scene from It's a Wonderful Life, in which George Bailey explains to depositors why the bank cannot pay everyone back at once.
Recommended by 0 HN commenters across 0 different months, 2019 to 2023.
What Hacker News said
Cites holy_city · 2019-06 · on “Facebook, Libra, and the Long Game”
Someone once told me that U of Chicago's business school used this classic to describe banking: [this video]
Cites haberman · 2021-02 · on “Naked shorting: The curious incident of the shares that didn't exist (2005)”
Call me crazy but I thought the idea is that banks would use deposits to fund loans and kick some of the profit back to the account holder in the form of reasonable interest rates. That seems capital efficient to me, but it's apparently a quaint relic of the past now that eternal 0% interest rates are the norm. I'm reminded of the scene from It's a Wonderful Life where George Bailey explains to all his account holders why they can't all withdraw their money at once, because it's being put to productive use by their fellow townspeople: [this video]
Cites costco · 2023-03 · on “$Roku filed a Form 8-K revealing that $487M stuck at SVB (25% of cash)”
Where are the people offering to buy SVB claims for 60-70 cents on the dollar? This happened with FTX and traditional bank runs like in [It's a Wonderful Life]( [this video] ). Maybe people are waiting to see how large the FDIC advances will be.