USA HISTORY

Detailed explanation-1: -Unable to recover investments, collect loans and repay depositors, thousands of banks went bankrupt and were forced to close. The numbers are phenomenal: by 1933 over 4, 000 banks had closed and between 1929 and 1932 about 110, 000 companies had collapsed.

Detailed explanation-2: -The Depression In all, 9, 000 banks failed–taking with them $7 billion in depositors’ assets. And in the 1930s there was no such thing as deposit insurance–this was a New Deal reform. When a bank failed the depositors were simply left without a penny.

Detailed explanation-3: -March 1933. For an entire week in March 1933, all banking transactions were suspended in an effort to stem bank failures and ultimately restore confidence in the financial system.

Detailed explanation-4: -These runs on banks were widespread during the early days of the Great Depression. In 1929 alone, 659 banks closed their doors. By 1932, an additional 5102 banks went out of business.

Detailed explanation-5: -June 16, 1933. The Glass-Steagall Act effectively separated commercial banking from investment banking and created the Federal Deposit Insurance Corporation, among other things. It was one of the most widely debated legislative initiatives before being signed into law by President Franklin D. Roosevelt in June 1933.