In Episode 3 of **Banking Bad**, our guest is Eric Spitler, a law professor at the University of North Carolina and former Director of Legislative Affairs at the FDIC and the SEC, for a timely discussion about one of the oldest threats in banking: the bank run.
From Continental Illinois to Washington Mutual to Silicon Valley Bank, Eric shows how uninsured deposits have repeatedly turned institutional anxiety into system-wide risk. Eric explains why the old distinction between “stable” branch deposits and “volatile” brokered deposits no longer captures today’s dynamic. In a world where a depositor can instantly move $50 million from a phone, the real question is not how the money arrived at the bank—but whether the depositor has any reason to stay.
The discussion then turns to the difficult policy choices surrounding modern deposit insurance, including whether business payroll and operating accounts have become the Achilles heel of the system. Would broader protection reduce dangerous runs, or create too much moral hazard? The episode also looks beyond banks to money market funds, private credit, stablecoins, and tokenized deposits where similar run dynamics can easily emerge. It leaves listeners with a central question: if runs are now faster, more contagious, and more technologically amplified than ever before, are our crisis-management tools keeping up?
Eric SpitlerGuestJohn BovenciHost
Tom WeissHost
