Reply To: Bank Holidays, etc


What stopped the bank runs and failures was deposit insurance, not FDR’s bank holiday.

The Federal bank holiday lasted from March 6-13, 1933. On March 9, congress passed the Emergency Banking Act which, along with the Federal Reserve’s promise to provide liquidity to the banks, provided federal deposit insurance.

Deposit insurance was formalized with the passage of the Banking Act in June 1933, which established the FDIC.