September 18th 2008:
550 billion dollars were withdrawn from money market accounts on September 18, 2008 in less than two hours. Panic began to seep into the market and others withdrew money. The FED could not stop it with an infusion of 105 billion so they shut down the money market accounts and guaranteed $250,000 coverage for every money market account. If they had not done that their estimation was that by two o’clock that afternoon, $5.5 trillion would have been drawn out of the money market system of the United States. Panic would have increased, threatened Europe and economic failure was in the offing.
Rep. Paul Kanjorski later described this as an "electronic run on the banks".
https://www.youtube.com/watch?v=ODBPlD0FXOU
Now you can not just take money out of a system anonymously. So who was doing it? There must be a record. But this did not seem to be very interesting to anyone. It likely was a reaction to the Lehman collapse and the money was probably not withdrawn but shifted. (I hope not into short accounts, though.) But it would be interesting to see who it was.That, however, is not--or at least should not-- be the point. Kanjorski is implying the system was "attacked." But that subversive motive actually underestimates the problem. The real problem is that malice was not necessary; the system with its high volume computer trading can do this on its own.
550 billion dollars were withdrawn from money market accounts on September 18, 2008 in less than two hours. Panic began to seep into the market and others withdrew money. The FED could not stop it with an infusion of 105 billion so they shut down the money market accounts and guaranteed $250,000 coverage for every money market account. If they had not done that their estimation was that by two o’clock that afternoon, $5.5 trillion would have been drawn out of the money market system of the United States. Panic would have increased, threatened Europe and economic failure was in the offing.
Rep. Paul Kanjorski later described this as an "electronic run on the banks".
https://www.youtube.com/watch?v=ODBPlD0FXOU
Now you can not just take money out of a system anonymously. So who was doing it? There must be a record. But this did not seem to be very interesting to anyone. It likely was a reaction to the Lehman collapse and the money was probably not withdrawn but shifted. (I hope not into short accounts, though.) But it would be interesting to see who it was.That, however, is not--or at least should not-- be the point. Kanjorski is implying the system was "attacked." But that subversive motive actually underestimates the problem. The real problem is that malice was not necessary; the system with its high volume computer trading can do this on its own.
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