Deposit insurance and government's willingness to help distressed banks have virtually eliminated the potential for serious bank runs.

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Deposit insurance guarantees that depositors will be reimbursed up to a certain amount in the event of a bank failure. Additionally, the government has demonstrated its willingness to step in and rescue distressed banks in order to prevent widespread panic and economic collapse. These measures have greatly reduced the likelihood of serious bank runs.

Deposit Insurance and Government's Willingness to Help Distressed Banks Have