ABSTRACT
‘No doubt all precautions may, in the end, be unavailing – “On extraordinary occasions”, says Ricardo, “a general panic may seize the country, … – against such panic banks have no security on any system.” The bank or banks which hold the reserve may last a little longer than the others, but if apprehension pass a certain bound, they must perish too.’ (Walter Bagehot, Lombard Street , 1873 (Irwin, Illinois, 1962), p.27.)
