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Jason Brennan
Mrs. Balzano
Language Arts
19 January 2017
Finance in the 1930s
Former social reformer, abolitionist, and slave, Frederick Douglas once proclaimed, If
there is no struggle, there is no progress. This quote connects directly to the financial crisis in
the 1930s because the entire decade was a struggle for all. Many people were in debt, or had little
to no money. They sold almost all their belongings, including their houses, just to get a small
amount of money in order to use on more essential things like food and water. Although the
financial issues caused struggle, it also helped the future. It taught Americans about the
importance of money and why they have to be smarter with it. There are still issues with finance
to this day, but not nearly as severe as they were in the 1930s. The finance was progress for the
people of America; it just took years of struggle to make that progress happen. During the 1930s,
many issues occurred with money; people were in debt; banks started to head downhill and be
less successful; and, people used different types of currency instead of the regular U.S. Dollar.
The financial issues from this decade caused many issues for years to come.
Throughout the 1930s, the types of money used were different than how it is used in
present times. Before the stock market crash hit, there were 6 different types of currency in the
United States. Those were United States Notes, Gold Certificates notes, National Bank Notes,
Silver Certificates, Federal Bank Notes, and Federal Reserve Notes. All of these notes ranges
from prices as low as $1.00 to as high as $10,000. After the Great Depression, only three
remained. Those being United States Notes, Silver Certificates, and Federal reserve notes. These

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notes were signed by Andrew W. Mellon. Mellon was often called the greatest Secretary of
Treasury since Alexander Hamilton. He helped distribute money, reduce war debts and income
taxes. (Six kinds of United States Currency 3) These notes were also starting to get designed
differently. The United States large sized currency was replaced with small sized notes. There
were also different designs on the notes. As stated in the article, All the small notes featured a
portrait of Washington for the $1 note, Jefferson for $2, Lincoln for $5, Hamilton for $10,
Jackson for $20, Grant for $50, Franklin for $100, McKinley for $500, Cleveland for $1000,
Madison for $5000, and Chase for the $10,000. When one series of $100,000 notes was issued
(1934 Gold Certificates), Wilson was put on them. (2) This talks about the specific people
placed on each of the notes. The portraits were often called dead presidents even though
Alexander Hamilton, Benjamin Franklin, and Salmon Chase were never presidents of the United
States. Some large notes included other historical figures like Martha Washington and James
Monroe, but were never printed on small notes. Therefore, the types of money was changed
drastically from prior years in both appearance and value.
Furthermore, banks had trouble maintaining themselves through the 1930s. At the
beginning of the economic depression, banks all throughout the nation started to fail at alarming
rates. In the first 10 months of the 1930s, 744 banks had failed. Ten times the average amount of
70 banks annually in the 1920s. Throughout 1930s, a total of about 9,000 banks failed. It is
estimated that 4,000 banks had failed in 1933 alone. As a result, $140 billion had been lost
between 1933 and the start of the economic depression in 1929. Some towns during this time
period had one or more banks, but most towns had at least one. Banks either merged with one
another, or just failed, resulting in loss of money for the people (Bank Failures during the 1930s
Great Depression 1). This led President Franklin Roosevelt to close the banks right after his

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inauguration. He closed all banks in the country for a 3 day cooling off period. This was called a
national bank holiday. As President Roosevelt gave his speech in 1933 about his inaugural
address. Roosevelt identified two immediate objectives: getting people back to work and strict
supervision of all banking and credits and investments. (Roosevelt 1933) (Jabaily 2). Once
Roosevelt stated this, the following day cabinet members joined the Treasury and Federal
Reserve Officials in order to create and prepare the groundwork for the national bank holiday.
This gave banks time to make adjustments in order to maintain themselves more dependable. An
example of this is the Milwaukee ministers. They agreed not to pass around collection plates
until the crisis was over. Also, the First Baptist Church in El Paso Texas started to allow I.O.U.
notes to be handed in. Other things such as fines for crimes were also changed in order to help
the financial situation. Instead of paying $2 to $5 fines, people had to serve one-day sentences
for their crimes. Although all of these changes had been made to help out people who had lost
their money, no reprieves were made for those who owed federal income taxes. (3) Henceforth,
trying to keep the banks maintained within what the law and government states.
Not only did banks have trouble maintaining themselves, but most people were struggling
with the debt situation. Firstly, farmers were angry about debt and bankruptcy that took their
farms away. The price of a bushel of corn was about 8 to 10 cents during this time period, not
giving farmers much to live off of. Some farmers even wanted the government to step in so that
farm families can live in their homes still. An example of one of these protests was in Le Mars,
Iowa, when a mob of angry farmers marched into a courthouse, dragged the judge off the bench,
and drove him out of town. These farmers demanded that no more cases were made to make a
farmer lose their farm. Once he refused, they threatened to hang him. Farmers in the 1930s also
started the Farm Strike. This was another protest that prevented dairy trucks from taking

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products made of milk into the cities and towns. The government pass the Agricultural
Adjustment Act (AAA) of 1933 which set limits on the size of crops and herds farmers could
produce. Those farmer that agreed to limit production were paid subsidy. (The Great Depression
Hits Farms and Cities in the 1930s 1). This helped cities and towns get food while farmers were
able to provide for themselves and pay taxes and debts. People in cities and towns also had many
troubles during this time of debt. As factories and stores shut down, many workers had lost the
jobs they once had. In Dubuque, Iowa, 2,200 people lost their jobs between 1927 and 1934. As
this happened, only 13 new businesses had opened, giving 300 people jobs. That made 1,900
people still without jobs. The Dubuque railroads gave 600 more people jobs in 1931. In 1934,
there were only approximately 25 jobs left. People also were forced to sign up for government
welfare. Before the Great Depression occurred, people found it disgraceful to sign up for
government welfare. Once families were faced with starvation, some men ended up signing up,
which was quite painful for them. One of the biggest issues for town and city dwellers was the
lack of food. They werent able to grow food like farmer could, so many families went hungry. In
some larger cities, there were soup kitchens that gave free food to families in need. Cold winters
also gave city dwellers issues since they couldnt afford coal. (2) President Roosevelt also called
forth some more acts in order to help families regain jobs that they couldnt have otherwise. The
Work Progress Association (WPA) hired men to work on public projects such as parks, roads,
bridges, etc. There was also a Civilization Conservation Corps (CCC) which hired teenage boys
to work so they could provide for their families. These boys lived in barracks and worked on
parks. Their small salary was sent back to their family, since they had necessities provided for
them at the barracks. (History.com Staff 7) President Roosevelt did much more for the people of
America during this time period. He was a reassuring voice for most people in the country. He

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sparked the idea of a project called the New Deal. It was a collection of government projects and
experiments that aimed to return prosperity and dignity back to Americans. The New Deal was
also a part of an attempt to stabilize the economy and provide jobs for the suffering. Some
examples of acts that he passed were the ending of prohibition on beer, the Social Security Act
which guaranteed pensions to millions of Americans. And the Wagner Act which prevented
businesses from treating their workers poorly. Although President Franklin Roosevelt did all of
these things in order to end the Depression Era, people continued to struggle for many more
years.
Hence, many issues were caused by the financial crisis all throughout the 1930s. The
types of money and the processes of their designs were changed so money could be saved on the
manufacturing and worth of paper money was also affected. In addition thousands of banks
failed while others struggled to maintain themselves. And, debt caused people in both cities and
towns to suffer. However it was because of the people going through the struggles and suffering
that brought a better financial system that we use today.

Works Cited

"Six Kinds of United States Paper Currency." Six Kinds of United States Paper Currency. N.p.,
n.d. Web. 17 Jan. 2017. http://www.friesian.com/notes.htm
"Bank Failures during the 1930s Great Depression." Bank Failures during the 1930s Great

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Depression. N.p., n.d. Web. 17 Jan. 2017.

http://www.livinghistoryfarm.org/farminginthe30s/money_08.html
Jabaily, Robert. "Bank Holiday of 1933 - A Detailed Essay on an Important Event in the
History of the Federal Reserve." Bank Holiday of 1933 - A Detailed Essay on an
Important Event in the History of the Federal Reserve. N.p., 22 Nov. 2013. Web. 17 Jan.
2017. http://www.federalreservehistory.org/Events/DetailView/22
"The Great Depression Hits Farms and Cities in the 1930s." IPTV. N.p., 10 Jan. 2017. Web. 17
Jan. 2017. http://site.iptv.org/iowapathways/mypath/great-depression-hits-farms-andcities-1930s
History.com Staff. "New Deal." History.com. A&E Television Networks, 2009. Web. 17 Jan.
2017. http://www.history.com/topics/new-deal