How did FDR assist farmers, workers, and homeowners during the first Hundred Days?
The Hundred Days and Bank Relief 19-1. The Hundred Days Before FDR inaugurated unemployment...
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Transcript of The Hundred Days and Bank Relief 19-1. The Hundred Days Before FDR inaugurated unemployment...
The Hundred Days and The Hundred Days and Bank ReliefBank Relief
19-119-1
The Hundred DaysThe Hundred Days
Before FDR inaugurated unemployment Before FDR inaugurated unemployment continued to rise, and bank runs continuedcontinued to rise, and bank runs continued People exchanged dollars for goldPeople exchanged dollars for gold Bank holidaysBank holidays were declared in 38 states were declared in 38 states
Gold standardGold standard Some afraid that FDR would abandon and would Some afraid that FDR would abandon and would
reduce value of dollarreduce value of dollar FDR FDR diddid take the country off the gold standard shortly take the country off the gold standard shortly
after becoming presafter becoming pres Then, FDR raised (and fixed) the price of goldThen, FDR raised (and fixed) the price of gold
The Gold StandardThe Gold Standard
FDR allowed the gov’t FDR allowed the gov’t to basically print 3 to basically print 3 billion dollars out of billion dollars out of nothing to finance his nothing to finance his programsprograms
Now, paper money is Now, paper money is devalued 41%devalued 41%
(Nixon eventually got (Nixon eventually got us totally off the gold us totally off the gold standard in 1971)standard in 1971)
Executive Order 6102Executive Order 6102 ““Forbidding the Hoarding of Gold Coin, Gold Bullion, Forbidding the Hoarding of Gold Coin, Gold Bullion,
and Gold Certificates within the continental United and Gold Certificates within the continental United States". States".
The order criminalized the possession of monetary gold The order criminalized the possession of monetary gold by any individual, partnership, association or corporation. by any individual, partnership, association or corporation.
all persons to deliver on or before May 1, 1933, all but a all persons to deliver on or before May 1, 1933, all but a small amount of gold coin, gold bullion, and gold small amount of gold coin, gold bullion, and gold certificates owned by them to the Federal Reserve, in certificates owned by them to the Federal Reserve, in exchange for $20.67 (equivalent to $371.10 today) exchange for $20.67 (equivalent to $371.10 today) per ounce per ounce
Specifically exempted "customary use in industry, Specifically exempted "customary use in industry, profession or art"—a provision that covered artists, profession or art"—a provision that covered artists, jewelers, dentists, and sign makers among others jewelers, dentists, and sign makers among others
Gold coins also upped in limit, due to collectorsGold coins also upped in limit, due to collectors
Inauguration Inauguration
March 4, 1933March 4, 1933 ““Let me assert my firm belief that the only Let me assert my firm belief that the only
thing we have to fear is fear itself…This thing we have to fear is fear itself…This nation asks for action, and action now!”nation asks for action, and action now!”
The New Deal BeginsThe New Deal Begins
Brain Trust Brain Trust FDR advisors FDR advisors Often disagreedOften disagreed
No clear agenda (No actual “New Deal”)No clear agenda (No actual “New Deal”) ““The country needs bold persistent The country needs bold persistent
experimentation…Above all try something.”experimentation…Above all try something.” And he did. LOTS of bills sent through legislationAnd he did. LOTS of bills sent through legislation
Hundred DaysHundred Days March 9-June 16 March 9-June 16 15 major acts passed15 major acts passed
EconomicsEconomics
KeynesKeynes Government spending Government spending
would spur demand would spur demand and thus pull a nation and thus pull a nation out of depression out of depression
Keynesian Keynesian economics was economics was Roosevelt’s Roosevelt’s philosophyphilosophy
TraditionalistsTraditionalists (Ex Hayek)(Ex Hayek) Cut government Cut government
spending to spending to encourage private encourage private investmentinvestment
http://www.youtube.cohttp://www.youtube.com/watch?v=d0nERTFm/watch?v=d0nERTFo-Sko-Sk
New Nationalism or New FreedomNew Nationalism or New Freedom
Gov’t work w/ Gov’t work w/ business business
Regulate wages, Regulate wages, prices, productionprices, production
OROR Distrust big business Distrust big business
completelycompletely Gov’t run parts of Gov’t run parts of
economyeconomy
““Trust busting”Trust busting” Regulation to keep Regulation to keep
competition faircompetition fair
Banks and Debt ReliefBanks and Debt Relief
Temporarily closed all banks March 9Temporarily closed all banks March 9Emergency Banking Relief ActEmergency Banking Relief Act
Unanimous Unanimous 38 min of debate38 min of debateRequired Fed examiners to survey banks and Required Fed examiners to survey banks and
issue licenses to those that were financially issue licenses to those that were financially soundsound
Fireside ChatsFireside Chats
March 12March 12Sixty million listenersSixty million listenersMoney will be secure in banksMoney will be secure in banksWhen banks opened, deposits > When banks opened, deposits >
withdrawals withdrawals
SEC and FDICSEC and FDIC
Securities Act Securities Act companies that sold companies that sold stock/bonds had to provide infostock/bonds had to provide info
SEC (Securities and Exchange Commission)SEC (Securities and Exchange Commission) Regulate stock market and prevent fraudRegulate stock market and prevent fraud
Glass-Steagall Act Glass-Steagall Act commercial banking commercial banking separate from investment bankingseparate from investment banking Commercial banks no longer allowed to risk Commercial banks no longer allowed to risk
despositors’ money by using it to speculate on the despositors’ money by using it to speculate on the stock marketstock market
Created Federal Deposit Insurance Corporation Created Federal Deposit Insurance Corporation (FDIC) to insure bank deposits(FDIC) to insure bank deposits
Mortgage and DebtMortgage and Debt
Low prices or Low prices or debtdebt cause of GD cause of GDMost income went to paying back debtMost income went to paying back debt
Cut back on spendingCut back on spendingHome Owners’ Loan CorporationHome Owners’ Loan Corporation
Bought mortgages of many homeowners who Bought mortgages of many homeowners who were behind in their payments were behind in their payments restructured, restructured, with lower interest rateswith lower interest rates
10% of homeowners10% of homeownersNot farmers, still employedNot farmers, still employed
The Farm Credit AdministrationThe Farm Credit Administration
(FCA) (FCA) lent 4x as much $ to farmers as lent 4x as much $ to farmers as the entire banking system had the year the entire banking system had the year beforebefore
Lowered interest ratesLowered interest ratesLong-term value?Long-term value?
Money to poor farmers meant that money was Money to poor farmers meant that money was not able to be lent to more efficient businessnot able to be lent to more efficient business
Slowed overall economic recoverySlowed overall economic recovery