The Way I Figure It.
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From the annals of banking history - a conversation with a banker who sold securities paying 50% every six months.
"Now the way I figure it. I have about 8 million in the banks right now, and I owe 15 million.
This run that's started has people bringing in their notes before they're due, so I will save the 50% on every one I get back.
Then, McMasters is putting out some warnings about speculators buying up notes up for a discount.
The speculators as working for me, and a lot of people will sell them at a loss rather than stand in line with a chance of getting nothing back."
But how can the banker honour every note? Won't he still be behind?
"If I use up my eight million, I clear about twelve million. But I am still three million short, right?"
The banker was visibly excited.
"This is when I will pop the deuce out of my sleeve. I am a director of Bank X, a block away from the courthouse. We stage the showdown at Y's office, and when his officer is ready to announce the total my liabilities, I show up with my all my cancelled notes, bankbooks, stocks and everything related to the asset side. But, on my way over, I stop at Bank X, grab enough cash and securities to make up the difference. There is easily five million in negotiable stuff in the vault."
Of course these days our venerable banker could simply get a net worth certificate, and save the bother of looting their own vault.
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