Monday 6 October 2008

History Comes Alive Again: What Would FDR Do If He Were President?

There was one time in our history when the US government closed the doors to every bank in the nation for a very short time -- it was called a "bank holiday." It happened when Franklin Delano Roosevelt (FDR) first took office in 1933 - and this was his very first act as President.

By 1933, over $140 billion in depositors' money had gone up in smoke because of banking failures (over 9,000 altogether during the 30's) and there was a run on banks throughout the country that threatened to bring the whole system down.

This was in an era when you could buy a luxury car for less than $1,000 and a mansion for $20,000.

One of our problems is that the only people who actually lived through the reality of this time and were adults when it happened are 90 years and older - which is probably why we are repeating it again.

FDR, as President, explained it all to the American people during his first "Fireside Chat" seventy-five years ago, and it was a chat only 13 minutes long!

There are three striking features about this talk:

1. It's coherent and detailed.

2. The government at the time seemed to have the capacity to rapidly evaluate the soundness of banks throughout the nation.

3. The currency sent to replenish bank supply was, according to FDR, backed by sound assets.

Today there are idiots in the White House who can't string sentences together that make sense; the government not only can't seem to examine banks, it doesn't seem to feel any responsibility to do so; and in our contemporary "Version 2008" - our administration has a penchant for creating new money based on assets we already know are garbage!

So, by this standard, it stands to reason that we are actually in WORSE shape than back in the 1930s -- we are at the mercy of rattled and confused "financiers" who are likely to continue to pull numbers (like 700 Billion) out of hats. Not only that it will be over three more months until the next administration takes charge! They really could/should take notes from FDR's first masterful Fireside Chat:

Here is the link to Part 2 (only 6.5 minutes long)

-Clair (Adapted from what I found at BrassCheck TV)

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