The Fireside Chats of Franklin Delano Roosevelt

The Fireside Chats of Franklin
Delano Roosevelt

The Project Gutenberg EBook of The Fireside Chats of Franklin
Delano Roosevelt
by Franklin Delano Roosevelt (#3 in our series by Franklin Delano
Roosevelt)
Copyright laws are changing all over the world. Be sure to check the
copyright laws for your country before downloading or redistributing
this or any other Project Gutenberg eBook.
This header should be the first thing seen when viewing this Project
Gutenberg file. Please do not remove it. Do not change or edit the
header without written permission.
Please read the "legal small print," and other information about the
eBook and Project Gutenberg at the bottom of this file. Included is
important information about your specific rights and restrictions in how
the file may be used. You can also find out about how to make a
donation to Project Gutenberg, and how to get involved.
**Welcome To The World of Free Plain Vanilla Electronic Texts**
**eBooks Readable By Both Humans and By Computers, Since
1971**
*****These eBooks Were Prepared By Thousands of
Volunteers!*****
Title: The Fireside Chats of Franklin Delano Roosevelt

Author: Franklin Delano Roosevelt
Release Date: May, 2004 [EBook #5767] [Yes, we are more than one
year ahead of schedule] [This file was first posted on September 1,
2002]
Edition: 10
Language: English
Character set encoding: ASCII
*** START OF THE PROJECT GUTENBERG EBOOK, THE
FIRESIDE CHATS OF FRANKLIN DELANO ROOSEVELT ***

This etext was produced by Steve Bonner.
The Fireside Chats of Franklin Delano Roosevelt
Radio addresses to the American people broadcast between 1933 and
1944.

March 12, 1933.
I want to talk for a few minutes with the people of the United States
about banking--with the comparatively few who understand the
mechanics of banking but more particularly with the overwhelming
majority who use banks for the making of deposits and the drawing of
checks. I want to tell you what has been done in the last few days, why
it was done, and what the next steps are going to be. I recognize that the
many proclamations from state capitols and from Washington, the
legislation, the treasury regulations, etc., couched for the most part in
banking and legal terms should be explained for the benefit of the
average citizen. I owe this in particular because of the fortitude and
good temper with which everybody has accepted the inconvenience and
hardships of the banking holiday. I know that when you understand
what we in Washington have been about I shall continue to have your
cooperation as fully as I have had your sympathy and help during the
past week.

First of all let me state the simple fact that when you deposit money in
a bank the bank does not put the money into a safe deposit vault. It
invests your money in many different forms of credit-- bonds,
commercial paper, mortgages and many other kinds of loans. In other
words, the bank puts your money to work to keep the wheels of
industry and of agriculture turning around. A comparatively small part
of the money you put into the bank is kept in currency-- an amount
which in normal times is wholly sufficient to cover the cash needs of
the average citizen. In other words, the total amount of all the currency
in the country is only a small fraction of the total deposits in all of the
banks.
What, then, happened during the last few days of February and the first
few days of March? Because of undermined confidence on the part of
the public, there was a general rush by a large portion of our population
to turn bank deposits into currency or gold--a rush so great that the
soundest banks could not get enough currency to meet the demand. The
reason for this was that on the spur of the moment it was, of course,
impossible to sell perfectly sound assets of a bank and convert them
into cash except at panic prices far below their real value.
By the afternoon of March 3d scarcely a bank in the country was open
to do business. Proclamations temporarily closing them in whole or in
part had been issued by the governors in almost all the states.
It was then that I issued the proclamation providing for the nation-wide
bank holiday, and this was the first step in the government's
reconstruction of our financial and economic fabric.
The second step was the legislation promptly and patriotically passed
by the Congress confirming my proclamation and broadening my
powers so that it became possible in view of the requirement of time to
extend the holiday and lift the ban of that holiday gradually. This law
also gave authority to develop a program of rehabilitation of our
banking facilities. I want to tell our citizens in every