Alas, Babylon

The news that First National was refusing to honor travelers checks and government bonds spread through Fort Repose’s tiny business section in a few minutes. The merchants, grocers, druggists, the proprietors of specialty shops and filling stations, deduced that if travelers checks and government bonds were worthless, then all checks would soon be worthless. Since opening their doors that morning, all sales records had been smashed. Everybody was buying everything, which to the shopkeepers was exhilarating as well as frightening. Most of them, from the first, had been cautious, refusing to accept out-of-town checks, except, of course, payroll and annuity and government pension checks, which everyone assumed were always as good as cash. When the bank acted, their first reaction was to regard all paper except currency as probably worthless.

Their next reaction was to race to the bank and attempt to convert their suddenly suspect paper assets into currency. Looking out through the office door, Edgar watched the queues in the lobby, hoping they would shorten. Instead, they lengthened. He called Mr. Pennyngton and together they checked the cash position. Incredibly, in a single hour it had been reduced to $145,000. If continued at this rate, the bank would be stripped of currency by eleven-thirty, and Edgar guessed that the rate of withdrawals would only increase. Edgar Quisenberry made his decision. He went into the four tellers’ cages and, one by one, removed the cash drawers and carried them into the vault. He then closed and locked the vault. He walked back to the lobby, stepped up on a chair, and raised his hands. “Quiet please,” he said.

At that moment, there were perhaps sixty people in the queues. They had been murmuring. They were silent.

“For the benefit of all depositors, I have been forced to order that the bank be temporarily closed,” Edgar said.

They were all looking up at him. He was relieved to see Cappy Foracre, the Chief of Police, and another officer, turning people away from the door. Apparently, they had sensed there might be trouble. Yet Edgar saw no menace in the faces below. They looked confused and uncomprehending, dumb and ineffectual as cattle barred from the barn at nightfall. He said, “This temporary closing has been ordered by the government as an emergency measure.” It was only a white lie. He was quite sure that had he been able to get in touch with Federal Reserve, this is the course that would have been advised.

His depositors continued to stare at him, as if expecting something more. He said, “I can assure you that your savings are safe. Remember, all deposits up to ten thousand dollars are insured by the government. The bank is sound and will be reopened as soon as the emergency is over. Thank you.”

He stepped down and returned to his office, careful to maintain a businesslike and dignified attitude. The people trickled out. He kept his staff busy until past noon balancing books and accounts. When all was in order, he advanced each employee a week’s salary, in cash, and informed them that he would get in touch with them when they were needed. When all had left, and he was entirely alone, he felt relieved. He had saved the bank. His position was still liquid. Dollars were good, and the bank still had dollars. Since he was the bank, and the bank was his, this meant that he possessed the ready cash to survive personally any foreseeable period of economic chaos.

Edgar’s calculations were not correct. He had forgotten the implacable law of scarcity.

Like most small towns, Fort Repose’s food and drug supply was dependent upon daily or thrice weekly deliveries from warehouses in the larger cities. Each day tank trucks replenished its filling stations. For all other merchandise, it was dependent upon shipments by mail, express, and highway freight, from jobbers and manufacturers elsewhere. With the Red Alert, all these services halted entirely and at once. Like thousands of other towns and villages not directly seared by war, Fort Repose became an island. From that moment, its inhabitants would have to subsist on whatever was already within its boundaries, plus what they might scrounge from the countryside.

Provisions and supplies melted from the shelves. Gasoline drained steadily from the pumps. Closing of the First National failed to inhibit the buying rush. Before closing, the bank had injected an extra $100,000 in cash into the economy, unevenly distributed. And strangers appeared, eager to trade what was in their wallets for necessities of the moment and the future.