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Banks vows and troubles..

May 21 2012 at 5:36 AM
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The banking system depends on the fact that banks only hold a small portion of customer deposits in cash that is ready to pay out. The rest is invested or passed on to other customers as loans at from 20% or 25% interest, while the banks pay very small interest to depositors, 1% or 5% interest only maximum. Now when those loans do default and when a bank run occurs, (that is the customers with deposits run to the banks to withdraw their full deposits because of fear and non-confidence in the banks) this act lands every bank in the world in trouble -- even the healthiest ones.
May/18/2012
Crisis of Confidence
Fears of Bank Runs Mount in Southern Europe
By Stefan Kaiser
http://www.spiegel.de/international/europe/fears-of-bank-runs-increase-in-europe-a-833879.html

 
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Re: Banks vows and troubles..

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May 22 2012, 5:15 AM 

The banking crisis can be solved in a day if laws are passed that banks can charge interest only in the amount of the double of the interest that they pay the depositors and not 20 times the interest of what they pay to depositors.

 
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