Oops, missed this one from a year and a half ago.
Banks can lend out all savings holding nothing in reserve to fund withdrawals. If your bank goes belly up, can there be a bank run if there is nothing to run with?
Historically, banks are required to keep 10% of their loaned-out capital in reserves. However, the Fed just took an extraordinary step of reducing that to 0%.
Banks no longer to keep any assets in reserve. This will turn a house of cards into a gargantuan palace of cards.
Be seeing you
MCViewPoint 