October 29th, 1929, also known as Black Tuesday, was the first major sign of the Great Depression; the stock market had crashed. That day, thousands of dollars had vanished, and it left countless American citizens panicking. Over the next few years, a myriad of people lost their jobs, homes, and faith in the American government. When Franklin Roosevelt won the election of 1932, he brought forth his plan to restore confidence in the American government: the New Deal. Throughout his term, Roosevelt started many programs to create jobs and reform the economy. The most effective of Roosevelt’s policies was the Federal Deposit Insurance Corporation, or the FDIC, due to the fact that it is a long lasting program that has insured individuals’ deposits …show more content…
The FDIC protected the deposits of individuals at banks by insuring up to 2,500 dollars of their deposit. This policy, along with other efforts to mend the faults in the banking system, were established in the banks across the country. By doing this, bank closures that had become extraordinarily prevalent in the early 1930’s were almost nonexistent in 1934 and beyond; many financial institutions during the Roaring 20’s invested money in unstable stocks in hopes of making significant gains, and this played a major role in the bank failures following the stock market crash. By restricting the banks and requiring them to insure the deposits of American citizens, the FDIC was successful in making the banking systems of America safer and more …show more content…
Very few of the New Deal programs are still established; the existence of this program over 80 years after its establishment shows that it is a successful, needed component of the American economy. The FDIC now insures at least 250,000 for each depositor in a bank; by doing this, it reduces the consequences if a banking institution were to fail. Since it's establishment, not a single depositor has lost money due to a blank closure. The people of today’s society know that their money is safe in banks, and they are more likely to deposit it than ever