Beginning of the Avalanche?
"Patient queues in very British bank run
By Tom Braithwaite in London and Chris Tighe in Newcastle
Published: September 14 2007 20:06
Customers of Northern Rock ignored the attempt at reassurance from the companyâ¿¿s chief executive on Friday and embarked on a very British bank run.
A queue of 11 people had formed before 9am at the City of London branch, barely 100m from the Bank of England in Londonâ¿¿s financial district where Thursday nightâ¿¿s lifeline was agreed. In a pattern mirrored across the country, they waited patiently, accepted there was no need to panic â¿¿ but said they were withdrawing their money just in case.
â¿¿The website was down and no one was answering the phone this morning,â¿¿ said one depositor. â¿¿When the shares fell 20 per cent I decided to come down and take my money out.â¿¿
Across the road a grinning office worker snapped a picture of the queue on his mobile phone, then dived back into his building.
On the receiving end of the attention, another City worker â¿¿ who like many on Friday did not want to be named â¿¿ said he, too, was removing his money. â¿¿I think their model is inherently unstableâ¿¿.â¿¿.â¿¿.â¿¿They are lending on wafer-thin margins,â¿¿ he said. â¿¿No, I donâ¿¿t think there is any huge risk but when you put your money in a building society you expect it to be 100 per cent safe. Youâ¿¿d look pretty stupid if it did collapse.â¿¿
Given the status of the subprime debacle here, and shaky debt-based pyramiding by central banks, it shouldn't be long now.