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Well, there is nothing that can prevent a bank run: at times of crisis when bank would suffer a bank run, when trust in currency is lost, government can only pr
by necovek 4y ago
Well, there is nothing that can prevent a bank run: at times of crisis when bank would suffer a bank run, when trust in currency is lost, government can only print out more money, thus deflating the value of a dollar.
Which is when people will still want to convert to something that is better guaranteed to preserve value: prompting a bank run!
US has so far resisted this because it's such a huge economy that nobody wants to see default on its debts (all foreign debt it has is denominated in USD), and as dollar drops, everybody starts buying in the US.