New Deal - Banking and Finance - EGGSSTEBR Flashcards
1
Q
Emergency Banking Relief Act
A
March 1933
Aim was to restore confidence in American Banking
- Closed all the banks in the country for 4 days
- Fireside chats
By April $1 Billion in currency had been returned to the banks
2
Q
Glass Steagall Act
A
June 1933
- Bank Officials not allowed to take out loans form their own banks
- Individual bank deposits insured against bank failure up to a figure of $2500 to be overseen by the Federal Deposit Insurance Corporation (FDIC)
- Commercial Banks banned from involvement in 1920’s style speculation and investment.
3
Q
Gold Reserve Act
A
January 1934
- RFC would buy Gold above market price, to reduce the value of the dollar. $ Devalued 60% since March 1933.
- Pegged at $35 an ounce
- Failed to revive economy, even though prices rose.
4
Q
Silver Purchase Act
A
June 1934
- Treasury would buy silver until its value equaled 33% that of gold.
- Effectively subsidized the silver mining industry, no real economic benefit.
5
Q
Securities Act
A
1934
- Set up the Securities Exchange Commission
- Aim was to prevent fraudulent activities such as insider dealings.
- Act was highly successful despite opposition of Wall Street Insiders.
- System caught Richard Whitney in 1938 for Embezzlement in 1938, improved Wall Street’s credibility.
6
Q
Truth in Securities Act
A
1933
- Required brokers to offer clients realistic information about the securities they were selling.
7
Q
Economy Act
A
1933
- Slashed Government salaries
- Cut soldiers pensions
- Refused the “bonus” from bonus march, 2nd time demonstrators came Eleanor Roosevelt was sent to charm them, and they left peacefully.
8
Q
Banking Act
A
Act intended to give feds control of banking in the USA. Control of banking shifted from private banking to central government and the centre of management shifted from New York to Washington DC.
9
Q
Revenue Act
A
June 1935
- Plan to increase taxes on the rich
- Max tax on those who earned more than $50,000 was increased from 59->75%
- Act only raised $250 million because it only affected 1% of the population.
