, Columnist
Bank Runs Are Terrible. The Fed Can Eliminate Them.
There’s a better way to ensure lenders can always pay their depositors.
Bank runs should be behind us.
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Almost a year ago, America experienced a frightening financial shock: a run on banks, in which depositors raced to pull money out of institutions that they feared were about to collapse.
Such events can and should be a thing of the past, but this will require significant changes in the way the Federal Reserve backstops the banking system.