The Unusual Way FDR Turned the Economy Around During the Great Depression

In 1933, FDR put an executive order in motion.

Its purpose was to help turn the economy around during the Great Depression, and to do that the government needed to print money.

But in order to print more money, the government needed gold–and they decided to get it from their very own citizens.

So FDR’s executive order required U.S. citizens to surrender much of their gold holdings to the Federal Reserve. (They were compensated for the gold at $20.67 per ounce.)

This was to stabilize the U.S. banking system following a severe bank run.

You might ask, why did they need gold in order to print more money?

In 1933 we were still on a classical gold standard that required the government to have a substantial stock of gold in order to ensure that the dollar to gold ratio was properly in place.

We don’t have that now.

We are currently on a fiat money system that requires absolutely zero gold to operate.

Are you interested in learning more about the history of money?

Check out my course Barter to Currency here: https://www.tradeway.com/barter-to-currency

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DISCLAIMER: These examples are for educational purposes only. Investing and trading in the stock market involves inherent risks including loss of funds. Please seek education and support before making investment decisions.

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