The Crisis of March 1933
Saturday, March 4, 1933, dawned on a nation almost devoid of banking facilities. In the previous days and hours banking officials had worked feverishly to salvage the collapsing situation, but by Thursday, March 2, bank moratoria had been declared in twenty-one states. Day and night, conferences were held at the White House, the Treasury Department, the Federal Reserve Board, and at the offices of Federal Reserve banks around the country. Bankers and government officials sought a means to stem the floods of panic sweeping the nation. Plans were evolved, evaluated, and then discarded. Members of the new administration immediately began work upon arrival in Washington. Some of the old administration remained at their posts. All labored in unison to save the banks. For a time hope was held that the large banks in the financial centers would weather the storm; that with the inauguration of Franklin Roosevelt, a surge of confidence would sweep the country, the tide would turn, and conditions would be stabilized. Hope was in vain. No satisfactory solution was found, meetings disintegrated, the banking structure crumbled, and state by state the banks closed.
As bank holidays spread, and more and more states took action, Senator James Couzens, Republican from Michigan, proposed legislation to permit federal authorities to close national banks in those states in which other banks were already closed. 1 This was the only federal statutory measure enacted by Congress to meet the banking crisis. Remedial