This is what caused the bank runs.

The "Bank Walk" continues. Bank deposits now down 4.1%.

This is your sibling, your neighbor, people with money sitting in a bank account, each at their own pace deciding they're sick of earning 0%. Each day, someone new, moving their money out of 0% and into 4% T-Bills. pic.twitter.com/OGbS1FHqU0

— Jeff Weniger (@JeffWeniger) April 3, 2023

I have to admit, I didn't really think very deeply about the rising interest rates in regards to capital flight. As everyone who reads this blog knows, I focus on housing because housing touches everyone. Most people don't have enough money to care about savings interest. And it's been so long time since interest rates were this high. Most of us have never gotten a chance on the good side of  the interest rate hike train. 

I haven't really moved any money yet because I have a good credit union paying me 3.10 in interest. I have been saving for land the entire pandemic and am earning some pretty decent interest there.. 

With interest rates this high, people will be motivated to move. Big banks pay nothing in interest. So people are moving their funds to money markets. Which honestly I hadn't heard about since i was a kid. But all of us are waking up it it now. 

A few months ago Mr S. told me that when he was a kid he thought all you had to do was make a million bucks. Then you could live off the interest.