Video [4:00 min]: It's a Wonderful Life

Synopsis: George Bailey, as head of the town’s savings and loan association, keeps his own salary at a reasonable level. He makes sure that the S & L is operated for the benefit of its members and serves the interests of the community. He has a lifelong competition with the town’s richest businessman who, despite his vast wealth, will do anything to make another buck.

As George Bailey sets off on his honeymoon in a taxicab, he realizes that depositors have gathered outside a local bank, demanding their money. Instead of continuing on his honeymoon, George hustles to his beloved Bailey Building and Loan, where he finds it closed and hence in mortal peril.

The ensuing scene encapsulates the promise of the American financial system. And it explains why, in the first half of the 20th century, policymakers encouraged the development of institutions and markets powerful enough to make—or break—the lives of all Americans.

Of course, the scene also dramatizes the financial conflict between protagonist George Bailey and antagonist Henry F. Potter. After George lets his distraught depositor-investors in and the Building and Loan opens for business, he learns that Potter recently acquired the town’s other bank and then ordered the immediate repayment of funds it had loaned to his Building and Loan, thus denuding the mortgage lender of all its cash.

That premise would have been plausible and familiar to viewers of the movie because, in that era, financial intermediaries often made short-term loans to each other that stipulated repayment upon demand. The subtext, revealed in this and a previous scene, is that the Bailey Building and Loan needed to borrow from the bank because some of its own borrowers were in distress and not making payments.

Today, Savings and Loans are regulated and the deposits are insured at the same levels as Banks. Would a scene like this be likely in today's environment?