In the same manner that Lynn described, an iteration of a loop will be complete when everything inside it has been completed, so if you have 2 serial reads, the 9600 one finishes first (assuming the bytes for the 2400 one aren't already in the serial buffer) and waits until the rest of the code in the current iteration finishes before running again. If the data is really coming in at those rates, the waiting should be enough to cause an overflow.
I'm not sure how LV would handle a buffer overflow and where in the buffer subsequent iteration would start reading from.
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