We appear to be entering the sort of scenario that doomsday preppers have been warning about for years. A pandemic is spreading death and panic around the world. Markets are crashing. Store shelves are emptying…

How long will it be before the economy grinds to a halt completely? How long will it be before the heavily leveraged financial system simply freezes up?

Emergency rate cuts by the Federal Reserve won’t necessarily keep the banks open. Central bankers won’t necessarily keep grocery stores supplied with food. And they won’t necessarily help you and your family survive the present crisis.

We don’t know if the worst is behind us or yet to come.

The point of preparedness isn’t to try to predict when a crisis will hit or how long it will last. The point is to always be ready for a worst-case scenario.

Why Bank Runs Occur

You don’t want to be among those lined up outside of a big box store hoping to fight your way to the last remaining inventories of toilet paper. Yes, frantic, sometimes combative bathroom tissue runs are now occurring across many parts of the world as panic buying sets in.

As Australian economist Alfredo R. Paloyo explains, “This panic buying is the result of the fear of missing out. It’s a phenomenon of consumer behaviour similar to what happens when there is a run on banks.

“A bank run occurs when depositors of a bank withdraw cash because they believe it might collapse. What we’re seeing now is a toilet-paper run.”

If social panic spreads and escalates, bank runs and closures will be a likely consequence. It’s driven by the same mass psychology that is now clearing store shelves.

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