The Magic Coin

Chapter 5

THE BANK GETS IN TROUBLE

Newton hovered above Lily’s hand and started spinning. The people around them zipped in and out and around while the sun quickly vanished over the horizon. The world turned into a blur as the sun raced across the sky hundreds of times. The seasons changed every half second. She could see a wash of green each spring and then a heavy coat of white snow each winter.

IT WAS DIZZYING.

Finally, time slowed back to its usual flux and Newton landed in Lily’s hand. They were still outside the goldsmith bank, but the building showed some signs of age. The people inside looked a little nervous.

“Watch this,” Newton said.

A man walked in with no coins or receipts, and then a few minutes later came out with a stack of banknotes.

“What did he do?” Lily asked.

“He just got a loan. People have started using the banknotes as money, and the bankers have realized that they can make even more money by lending out the banknotes.”

“What’s wrong with that?”

“Well, there’s nothing wrong with loans per se, but these bankers have lent out more banknotes than the gold in their vaults! They figure that they can earn some interest as long as people don’t come asking for their gold back. It’s profitable hanky-panky.”

“Uh-oh,” Lily said. “What if too many people come back wanting the coins they deposited?”

“That would be

A BANK RUN!

A CRISIS!

TROUBLE!”

A group of people overheard Newton and ran toward the building in a panic. The commotion attracted even more people, and Lily saw a stampede of depositors coming down the street.

“Let’s get out of here!” Newton exclaimed, and they vanished in a flash.