THe instution that allowed a stock market crash, that was expected to be another recession to turn into a depression. Bywhich should of added more money into the economy to stimulate spending, growth and eventually decrease unemployment. Failing to do this, the money supply in the banks fell short of expections, which caused a run on the banks. Which then further worsened the crisis.
The Federal Reserve controls interest rates to loans given out to banks, in order to control the money supply.
by ericandude July 6, 2008
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The Federal Reserve loaned out extra lines of credit to lower banks and those banks loaned out the extra credit to the people. In Capitalism there wouldn't be extra money given to banks to loan out. The banks would restrict credit and the business cycle would stablize itself.
When the economy turned bad starting in the mid 1920s people couldn't pay back all of their credit, banks lost money and failed, and the Great Depression started.
The Federal Reserve loaned out extra lines of credit to lower banks and those banks loaned out the extra credit to the people. In Capitalism there wouldn't be extra money given to banks to loan out. The banks would restrict credit and the business cycle would stablize itself.
When the economy turned bad starting in the mid 1920s people couldn't pay back all of their credit, banks lost money and failed, and the Great Depression started.
Thanks to socialist institutions like the Federal Reserve, we entered the Great Depression, only to be saved by the capitalistic industrialists of the WWII era
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Me: Aye cuz get the fucc on u Acting Federal rn like deadass!!
Me: Aye cuz get the fucc on u Acting Federal rn like deadass!!
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