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A Bank Run in Louisianna – “Huey Long”, T. Harry Williams

September 12th, 2012 · No Comments · Economics, Policy, Politics, Psychology, Social Psychology

(The first man in line in a bank run) soon appeared (at the opening of the bank), waving a check for $18,000 and confident that he, at least, would get his money. Entering the office, he was startled to see Governor Long behind the desk. Huey was waving a check himself. “The state of Louisiana has got $265,000 in this bank,” he explained genially, “and here’s the state’s check for it. There ain’t but about that much cash in the bank, and I was here before you were. You insist on drawing out your $18,000, and I’ll insist on drawing out the state’s $265,000 – and I get first draw, so there’ll be nothing left to pay you. You agree to leave yours in, and I’ll leave the state’s in, and nobody’ll be hurt. I’m staying right here till closing time at noon, in case anybody else wants to draw out.” The staggered customer had no choice but to agree to leave his money in. So also did every depositor who entered after him. The bank closed at noon still solvent, and over the weekend Huey was able to bring in enough money from other banks to keep it going.

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