Question

why did so may banks fail at the onset of the great depression?

Answer 1

People paniced and took out all of their money, so the banks collapsed. But, now America has the FDIC (Federal Deposit Insurance Corporation) to protect any money they have in banks, and to also protect the banks.

Answer 2

Also, at this time in our history, everything was very tightly connected. The banks were all heavily tied into the stock market, and banks gave each other loans as well. So when one big bank went down, it created a dominoes effect. For every bank that collapsed, a bunch more would be affected and would collapse as well.

Answer 3

Now we have the FDIC (Federal Deposit Insurance Corporation) to protect any money we have in banks, and to also protect the banks. There was no such protection at the beginning of the great depression, people panicked and withdrew ALL their money from all the banks, and therefore the banks collapsed.