Massive account withdrawals are in the news thanks to Europe. But while the proximate causes of the situation are unique to our time, the tradition of freaking out and demanding one’s money is thousands of years old.
Fourth Century B.C.: The Platonic Ideal
of Financial Chicanery
The first credit crisis chronicled in Carmen Reinhart and Kenneth Rogoff’s This Time Is Different: Besieged by angry lenders, Dionysius of Syracuse ordered that all metal coins be collected under penalty of death, restamped one-drachma pieces as two drachmas, and used his newly doubled assets to pay his IOUs.
1620s: Currency Problems in Germany? You Don’t Say.
Kipper-und Wipperzeit, Holy Roman Empire
During the Thirty Years’ War, German city-states minted imitations of rival cities’ coins using lesser metals. When soldiers discovered the fraud, they rioted and refused to serve unless given verifiably real coinage.
1772: Financial Haggis
A Scottish bank that had lost customer money in risky, MF Global–style speculation triggered chaos that took down almost all of the country’s private banks and inspired a cash-poor Parliament to pass the Tea Act.
1873: The Great Freakout of 1873
Also called the Panic of 1873. With banks falling as customers demanded gold for cash, the White House broke a treaty and sent General Custer into Lakota Sioux territory to hunt for ore. Which he found. Then the Lakota killed him but still lost most of their land. And now there are a bunch of giant president heads in the Black Hills.
1914: Schwenk Bank Run
New York, New York
Discovering dodgy accounting, state banking regulators seized three banks owned by Ladislaus W. Schwenk. Crowds soon formed outside one of them—then moved on to the East 7th Street rectory of a priest who they accused of vouching for Schwenk. (He disagreed with their interpretation.)
1930s: Great Depression
Upwards of 9,000 banks failed; depositors lost an estimated $140 billion in 1933 alone.
1946: Potter’s Panic
Bedford Falls, New York
A liquidity crisis at Bailey Building & Loan (instigated by ornate-wheelchair enthusiast Henry Potter) nearly drove the town to ruin, but an inspired speech by George Bailey saved the day—at least temporarily. Bedford Falls is now a depopulated shell of its former self whose sputtering economy relies on a nearby state penitentiary overflowing with nonviolent drug offenders.
1980s: Savings-and-Loan Crisis
In a sneak preview of the 2008 collapse, S&Ls lost customer money in mortgage-bond shenanigans, then needed a $100 billion bailout to make depositors (somewhat) whole.
2001: Malos Aires
The most prominent of the country’s many recent bank runs, which are so common that Argentines have a special name for how to deal with them: corralito, the enforced corralling of money inside the country.
A quarter of all deposits have been pulled from Greek banks over two years, and nearly $1 billion was withdrawn in a single day two weeks ago, though a lack of angry mobs has led observers to call the event a “bank jog,” an apt description—for now.