Bank runs in Europe

Still, it’s only Greece… for now:

Worried about whether the banks will stay in business, Greeks have been taking their life savings out of accounts and sticking them in metal slits in basement vaults. The boxes are so popular that the bank has doubled the rent on them in the past year – and still every day between five and 10 customers request one. This bank ran out of spares months ago. The clerk leans over: “I’ve been working in a bank for 31 years, and I’ve never seen a panic like this.”

Official figures back him up. In May alone, almost €5bn (£4.4bn) was pulled out of Greek deposits, as part of what analysts describe as a “silent bank run”.

Considering the size of the Greek economy, that’s a sizable amount.  Sarah Palin’s comments about the U.S.A. turning into Greece aside, I haven’t seen many signs of imminent U.S. bank runs, but then, it’s never a bad idea to keep an amount of ready cash and coin available. Especially of Ron Paul’s bill somehow manages to pass the House.

Rep. Ron Paul on Monday introduced legislation that would lower the federal government’s debt by canceling the roughly $1.6 trillion in debt held by the Federal Reserve.

And why not go ahead and cancel it? If the total amount of debt doesn’t matter because one person’s asset is another’s liability, then obviously canceling those debts can’t possibly matter any more than amassing them did. Since we are assured that the government’s growing debt to itself is not inflationary, then surely canceling that debt could not be deflationary.