An armed man raided a Lebanese bank and took several hostages after not being able to withdraw his money.
Lebanon has been in the news due to the economic meltdown it experienced in the last two years. Lebanon’s inflation rate surged from 2.89% in 2019 to over 210% in 2022.
Last year videos of Lebanese citizens rioting in front of banks circulated after Lebanese banks were hit by bank runs and froze withdrawals.
In a fractional reserve banking system, banks only keep around $10 for every $100 that a customer deposits. The other $90 are lent out. This is repeated over and over again as banks lend money into existence and increase the broad money supply.
It’s estimated that if only 2% of the world’s population were to withdraw their bank deposits at the same time, the entire global banking system would collapse. This happened on a smaller scale in Lebanon, as inflation and runs on the bank led to banks not being able to meet depositor demands.
One distressed man, who apparently needed to access his funds to pay for healthcare treatment of his relatives, went to the Federal Bank of Lebanon with a fire arm and took several hostages after being denied access to around $200,000 that was frozen in his bank account.
The man was heard yelling: “Let them give me back my money!”.
In the meantime, a crowd gathered around the local branch of the Federal Bank of Lebanon and chanted “Down with the rule of the banks!”.
The Lebanese government is currently engaging in financial repression by freezing accounts of Lebanese people that hold U.S. dollars and other “hard” currencies. There is a cap on how much U.S. dollars can be withdrawn.
When withdrawing Lebanese pound, residents can only withdraw small amounts and have to do so at a much lower rate than the parallel market rate, which means Lebanese people’s life savings are being withheld and destroyed.
