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The Great Depression

Why did banks close during the Great Depression and How?


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2010-03-05 01:29:03
2010-03-05 01:29:03

As the economic depression deepened in the early 30s, and as farmers had less and less money to spend in town, banks began to fail at alarming rates. During the 20s, there was an average of 70 banks failing each year nationally. After the crash during the first 10 months of 1930, 744 banks failed - 10 times as many. In all, 9,000 banks failed during the decade of the 30s. It's estimated that 4,000 banks failed during the one year of 1933 alone. By 1933, depositors saw $140 billion disappear through bank failures.

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what did so many banks close during the great depression

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The banks closed during the Great Depression simply because they ran out or nearly ran out of money. Later deposits made in banks were guaranteed by the federal government.

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Banks were forced to close during the Great Depression as there was a frantic run of customers withdrawing their money. Such was the run that the banks didn't have the actual money in their vaults. Much of the customers' money was on paper, loaned out to other banks, companies, etc. Banks also invested some of their customers' money in stocks and shares.

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was that he helped the banks during the Great Depression by making a national holiday where all the banks had close down for four days.

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He made Americans comfortable through the Great depression. He helped the banks during the great depression by making a national holiday where all the banks had to close down for four days and could ony re-open if they passed inspection.


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