Great Depression and the New Deal

Flashcards covering Franklin D. Roosevelt's policies during the Great Depression, including the New Deal and key financial reforms.

Who was the President during the Great Depression who took office in 1933?

Franklin D. Roosevelt

How did Franklin D. Roosevelt's approach to the Great Depression differ from Hoover's?

Roosevelt did not rely on voluntary cooperation and believed relief was a social duty, taking a more statist approach compared to Hoover.

What economic theory influenced Roosevelt's New Deal policies?

Keynesian Economics, advocating for government intervention to improve economic recovery.

Explain the concept of countercyclical fiscal policy.

When the economy is good, there is less government spending; when it is bad, there is more spending.

What was the main focus of the series of programs created by Franklin D. Roosevelt known as the New Deal?

Recovery, relief, and reform, consisting of immediate action to stop the economy from getting worse, temporary programs to help people, and preventing the crisis from happening again.

What was the first bill passed by Roosevelt when he took office, related to banking regulation?

A banking regulation bill that required banks to be inspected before reopening.

What were the key focuses of the New Deal?

Recovery, relief, and reform

What problem did the Glass Steagall Act and the creation of the FDIC (1933) address?

Speculation in the stock market and lost savings

What did the Glass Steagall Act do in regards to banking?

Separated commercial banking from investment banking

What is the FDIC?

Federal Deposit Insurance Corporation, a federal government agency that insures deposits in banks (up to $2500 at the time).

What key reform was implemented to monitor the stock market?

Monitoring for insider trading

What was the effectiveness of the Glass Steagall Act and the FDIC?

Reduced insider trading, increased trust in the stock market, and made banks safer.