Episode
The structural footprint of a bank run
- Published
- Jul 2, 2026
- Duration seconds
- 2409
- Processing state
not_requested- Canonical source
- https://www.complexsystemspodcast.com/deposit-franchises/
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Summary
Patrick McKenzie (patio11) reads his 2023 essay "Deposit Franchises as Natural Hedges," written seven weeks into that year's banking crisis, making the case that deposit franchises are a natural hedge against interest rate risk (one regional banks were quietly encouraged to sell off by loading up on agency MBS). He walks through why "sweat and smiles" deposits were assumed to be sticky enough to fund long-duration assets, why that assumption broke down for retail and sophisticated depositors alike once rates rose, and how the resulting losses moved through bank balance sheets. Patrick closes with two years of hindsight: what the essay got right and wrong about how bad it would get. – Full transcript available here: https://www.complexsystemspodcast.com/deposit-franchises/ – Presenting Sponsors: Mercury , MongoDB & Chainguard Complex Systems is presented by Mercury—radically better banking for founders. Mercury's new feature Command brings an LLM directly into your banking interface, so checking balances, finding invoices, or sending a wire is as easy as asking. Apply online in minutes at https://mercury.com/ . What's the point of building faster with AI if your database can't keep up? MongoDB's native data model mirrors the language LLMs already speak. Ship at the speed of AI while staying ACID compliant at Fortune 500 scale. Start building at https://mongodb.com/ai . If attackers are using AI to weaponize code faster than any team can review it, your scanners won't save you. Chainguard builds libraries and container images from source, verified all the way down, with near-zero CVEs and zero malware. Build safely at https://www.chainguard.dev/ . – Links: Deposit franchises as natural hedges: https://www.bitsaboutmoney.com/archive/deposit-franchises-as-natural-hedge…