Financial Investigation Quotes
There had been a run on many of the banks with more people wanting to withdraw their funds that there were funds to cover the deposits. Some people began hoarding cash and gold, making the situation even worse. Governors asked President Hoover in 1932 to declare a bank holiday to give the banks a chance to get liquid but he refused. So governors and stat legislatures began passing bank holiday legislation closing many banks. When Roosevelt took office he declared a national banking holiday which provided some relieve but the public felt that there was not enough money to go around and the banks were giving what cash they had to their own officers and directors and largest depositors. It appeared that much cash was disappearing from the banks and there was a suspicion that the banks took what cash they had and paid out the deposits of insiders and rich people, bu putting the cash in the insider’s safety deposit boxes. FDR closed that loophole and the bank holiday lasted for a week, after which time the government could stabilize things and the banks were ordered to reopen.
