Question

Go to www.fdic.gov and click on the tab "Industry Analysis" and then on the link "Research \& Analysis." Select "The First Fifty Years: A History of the FDIC 1933-1983." Open Chapter 3, "Establishment of the FDIC," and scroll down to the section entitled "The Banking Crisis of 1933 " and the section entitled "Federal Deposit Insurance Legislation." Read the section and then answer these questions. a. President Roosevelt was sworn in on March 4, 1933. What was one of his first official acts in response to the banking crisis? b. How many banks suspended operations during \(1933 ?\) c. Who was the chief proponent of federal deposit insurance in Congress? d. How much coverage did the temporary fund for federal deposit insurance provide?

Short answer

Who was the chief proponent of federal deposit insurance? Additionally, what was the temporary fund coverage provided by the Banking Act of 1933? Answer: President Roosevelt's first official act in response to the Banking Crisis of 1933 was to declare a nationwide bank holiday, temporarily closing all banks for assessment. During the crisis, 4,004 banks suspended their operations. Senator Carter Glass of Virginia was the chief proponent of federal deposit insurance. The temporary fund coverage provided by the Banking Act of 1933 was up to $2,500 per account.

Step-by-step solution

a. President Roosevelt's first official act

To find the answer to this question, the student should read the section "The Banking Crisis of 1933" on the FDIC page. The first official act of President Roosevelt was to declare a nationwide bank holiday, which temporarily closed all banks and allowed the government to assess their financial health. This measure helped to stabilize the banking sector and restore public confidence in financial institutions.

b. Number of banks suspended operations

To find the answer to this question, the student should read the same section, "The Banking Crisis of 1933," on the FDIC page. During the year 1933, a total of 4,004 banks suspended their operations. This information can be found in this section which describes the extent of the banking crisis during that time.

c. Chief proponent of federal deposit insurance

To find the answer to this question, the student should read the section "Federal Deposit Insurance Legislation" on the FDIC page. The chief proponent of federal deposit insurance in Congress was Senator Carter Glass of Virginia. He worked closely with other lawmakers on the Banking Act of 1933, which eventually led to the creation of the FDIC.

d. Temporary fund coverage

To find the answer to this question, the student should read the section "Federal Deposit Insurance Legislation" on the FDIC page. The temporary fund for federal deposit insurance provided coverage of up to $2,500 per account. This feature was part of the Banking Act of 1933, and it helped to ease the fears of account holders while the government worked to establish a more permanent solution for insuring bank deposits.