# How a bank run happens

> A process map exported from forks.world (https://forks.world). Author: Brian. Source: https://forks.world/p/cmv0kpu7j004sjn06auwzqloq
> It describes who does what, in what order, and with which technology. Read the plain-language sections first; the JSON at the end is the exact, complete data.

## Summary

- 15 steps across 1 layer
- Persona: Depositors, The bank, Regulators, Deposit insurance, News and social media

## Pain points

Where this process hurts, worst first:

- **Panic spreads online in hours** (How a bank run happens; painful): Social media makes runs far faster than in the past

## How to read this file

- A process is made of **layers**. The main layer is the top level; any step of kind `subprocess` opens a detail layer with its own lanes and steps.
- **Lanes** are either persona (people/roles) or technology (systems). Each step belongs to one lane; `using` lists tools a person uses for that step.
- Step kinds: `start`, `task`, `decision` (its arrows carry the answer as a label), `subprocess`, `end`.

## How a bank run happens

Lanes:
- Depositors: person / role (id `depositors`)
- The bank: person / role (id `bank`)
- Regulators: person / role (id `regs`)
- Deposit insurance: person / role (id `fdic`)
- News and social media: person / role (id `news`)

Steps, in the order they run:

1. **Deposits flood in and are invested in long-term bonds** [start; The bank; id `b1`]
   - then Interest rates rise, so the bonds lose value
2. **Interest rates rise, so the bonds lose value** [task; The bank; id `b2`]
   - then A rumor or a filing reveals the loss
3. **A rumor or a filing reveals the loss** [task; News and social media; id `b3`]
   - then Worried: withdraw?
4. **Worried: withdraw?** [decision; Depositors; id `b4`]
   - if "Yes" go to Withdraw, and tell friends; if "No" go to Wait and see
5. **Withdraw, and tell friends** [task; Depositors; id `b5`]
   - then Withdrawals surge, and it must sell bonds at a loss
6. **Withdrawals surge, and it must sell bonds at a loss** [task; The bank; id `b6`]
   - then Does it have enough cash and capital?
7. **Does it have enough cash and capital?** [decision; The bank; id `b7`]
   - if "Yes" go to It survives; if "No" go to Panic spreads online in hours
8. **It survives** [end; The bank; id `b8`]
9. **Panic spreads online in hours** [task; News and social media; id `b9`] ⚠ PAIN POINT (painful): Social media makes runs far faster than in the past
   - then Regulators close the bank
10. **Regulators close the bank** [task; Regulators; id `b10`]
   - then Insured deposits are protected; others wait
11. **Insured deposits are protected; others wait** [task; Deposit insurance; id `b11`]
   - then Does the problem spread to other banks?
12. **Does the problem spread to other banks?** [decision; Regulators; id `b12`]
   - if "Yes" go to Emergency lending and guarantees; if "No" go to Confidence slowly returns
13. **Emergency lending and guarantees** [task; Regulators; id `b13`]
   - then Confidence slowly returns
14. **Confidence slowly returns** [end; Depositors; id `b14`]
15. **Wait and see** [task; Depositors; id `b5a`]
   - then Worried: withdraw?

```mermaid
flowchart LR
  subgraph l_depositors["Depositors"]
    n_b4{"Worried: withdraw?"}
    n_b5a["Wait and see"]
    n_b5["Withdraw, and tell friends"]
    n_b14(["Confidence slowly returns"])
  end
  subgraph l_bank["The bank"]
    n_b1(["Deposits flood in and are invested in long-term bonds"])
    n_b2["Interest rates rise, so the bonds lose value"]
    n_b6["Withdrawals surge, and it must sell bonds at a loss"]
    n_b7{"Does it have enough cash and capital?"}
    n_b8(["It survives"])
  end
  subgraph l_regs["Regulators"]
    n_b10["Regulators close the bank"]
    n_b12{"Does the problem spread to other banks?"}
    n_b13["Emergency lending and guarantees"]
  end
  subgraph l_fdic["Deposit insurance"]
    n_b11["Insured deposits are protected; others wait"]
  end
  subgraph l_news["News and social media"]
    n_b3["A rumor or a filing reveals the loss"]
    n_b9["Panic spreads online in hours"]
  end
  n_b1 --> n_b2
  n_b2 --> n_b3
  n_b3 --> n_b4
  n_b4 -->|"Yes"| n_b5
  n_b4 -->|"No"| n_b5a
  n_b5a --> n_b4
  n_b5 --> n_b6
  n_b6 --> n_b7
  n_b7 -->|"Yes"| n_b8
  n_b7 -->|"No"| n_b9
  n_b9 --> n_b10
  n_b10 --> n_b11
  n_b11 --> n_b12
  n_b12 -->|"Yes"| n_b13
  n_b12 -->|"No"| n_b14
  n_b13 --> n_b14
```

## Full data (JSON)

```json
{
  "title": "How a bank run happens",
  "maps": {
    "m_root": {
      "id": "m_root",
      "lanes": [
        {
          "id": "depositors",
          "name": "Depositors",
          "type": "person"
        },
        {
          "id": "bank",
          "name": "The bank",
          "type": "person"
        },
        {
          "id": "regs",
          "name": "Regulators",
          "type": "person"
        },
        {
          "id": "fdic",
          "name": "Deposit insurance",
          "type": "person"
        },
        {
          "id": "news",
          "name": "News and social media",
          "type": "person"
        }
      ],
      "steps": [
        {
          "id": "b1",
          "kind": "start",
          "lane": "bank",
          "next": [
            {
              "to": "b2"
            }
          ],
          "uses": [],
          "label": "Deposits flood in and are invested in long-term bonds"
        },
        {
          "id": "b2",
          "kind": "task",
          "lane": "bank",
          "next": [
            {
              "to": "b3"
            }
          ],
          "uses": [],
          "label": "Interest rates rise, so the bonds lose value"
        },
        {
          "id": "b3",
          "kind": "task",
          "lane": "news",
          "next": [
            {
              "to": "b4"
            }
          ],
          "uses": [],
          "label": "A rumor or a filing reveals the loss"
        },
        {
          "id": "b4",
          "kind": "decision",
          "lane": "depositors",
          "next": [
            {
              "to": "b5",
              "label": "Yes"
            },
            {
              "to": "b5a",
              "label": "No"
            }
          ],
          "uses": [],
          "label": "Worried: withdraw?"
        },
        {
          "id": "b5a",
          "kind": "task",
          "lane": "depositors",
          "next": [
            {
              "to": "b4"
            }
          ],
          "uses": [],
          "label": "Wait and see"
        },
        {
          "id": "b5",
          "kind": "task",
          "lane": "depositors",
          "next": [
            {
              "to": "b6"
            }
          ],
          "uses": [],
          "label": "Withdraw, and tell friends"
        },
        {
          "id": "b6",
          "kind": "task",
          "lane": "bank",
          "next": [
            {
              "to": "b7"
            }
          ],
          "uses": [],
          "label": "Withdrawals surge, and it must sell bonds at a loss"
        },
        {
          "id": "b7",
          "kind": "decision",
          "lane": "bank",
          "next": [
            {
              "to": "b8",
              "label": "Yes"
            },
            {
              "to": "b9",
              "label": "No"
            }
          ],
          "uses": [],
          "label": "Does it have enough cash and capital?"
        },
        {
          "id": "b8",
          "kind": "end",
          "lane": "bank",
          "next": [],
          "uses": [],
          "label": "It survives"
        },
        {
          "id": "b9",
          "kind": "task",
          "lane": "news",
          "next": [
            {
              "to": "b10"
            }
          ],
          "pain": {
            "note": "Social media makes runs far faster than in the past",
            "level": 2
          },
          "uses": [],
          "label": "Panic spreads online in hours"
        },
        {
          "id": "b10",
          "kind": "task",
          "lane": "regs",
          "next": [
            {
              "to": "b11"
            }
          ],
          "uses": [],
          "label": "Regulators close the bank"
        },
        {
          "id": "b11",
          "kind": "task",
          "lane": "fdic",
          "next": [
            {
              "to": "b12"
            }
          ],
          "uses": [],
          "label": "Insured deposits are protected; others wait"
        },
        {
          "id": "b12",
          "kind": "decision",
          "lane": "regs",
          "next": [
            {
              "to": "b13",
              "label": "Yes"
            },
            {
              "to": "b14",
              "label": "No"
            }
          ],
          "uses": [],
          "label": "Does the problem spread to other banks?"
        },
        {
          "id": "b13",
          "kind": "task",
          "lane": "regs",
          "next": [
            {
              "to": "b14"
            }
          ],
          "uses": [],
          "label": "Emergency lending and guarantees"
        },
        {
          "id": "b14",
          "kind": "end",
          "lane": "depositors",
          "next": [],
          "uses": [],
          "label": "Confidence slowly returns"
        }
      ],
      "title": "How a bank run happens",
      "parent": null
    }
  }
}
```