History of Money Series: The Bank Holiday of 1933 - The Week America Closed Every Bank

Imagine waking up tomorrow and every bank in America is closed. Not just yours. All of them. No withdrawals, no cash, no way to make payroll. And nobody can tell you when it ends.

That happened. In March of 1933, every bank in the country was shut down for about a week. And when they reopened, Americans lined up not to pull their money out, but to put it back in.

In this episode of the History of Money series, Karl Eggerss explains what was actually breaking. Why the banks, not the 1929 crash, are what made the Great Depression great. Why your money has never sat in a vault, and why that isn't a scandal but the entire business model. How a bank run traps everyone into destroying a bank that would otherwise have been fine. And what happened on the Sunday night when a president got on the radio and, instead of telling 60 million frightened people to trust him, explained to them exactly how banking works.

Out of that week came the FDIC, which Franklin Roosevelt himself initially opposed, along with most of the banking industry. Their objection was that guaranteeing deposits would let reckless banks compete on equal footing with careful ones. That argument never went away, and the bank failures of 2023 brought it right back.

Karl closes with the practical part: what FDIC insurance actually covers, what it doesn't, and why the phrase "per ownership category" means many people are leaving protection on the table without knowing it.

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