Monday, October 6, 2008

US banks ordered to take 1933

Enid bank takes holiday in 1933

October 04, 2008 10:36 pm

The Wall Street crash of October 1929 led to the worst economic crisis in American history. By the winter of 1932, more than 13 million Americans were out of work — about one-third of the workforce. An aggravating factor in the Depression was the large number of bank failures. 
In those days, the federal government did not have any deposit insurance to guarantee bank deposits. Though some states, like Oklahoma, had tried to pass bank deposit laws, they were usually under funded and usually ineffective. People would rush to the banks to get what money they could before the bank ran out of money, causing a run on the bank.
Also, in those days, the president was not sworn in until March 4, and so from Nov. 8, 1932, when Franklin Delano Roosevelt defeated Herbert Hoover, until March 1933, people were waiting for the new administration to take office and the old and new administrations were not cooperating.
The bank panic became so bad that by March 2, 1933, 21 states had closed their banks. $5 to $15 million a day were being withdrawn from banks. On March 3, 1933. the panic spread to the Federal Reserve as $110 milllion of gold was paid out to foreign banks from New York and Chicago alone, with another $40 million paid out from other banks.
Roosevelt was sworn as president on March 4, 1933, and two days later, March 6, he declared a four-day bank holiday, closing down all banks.
Even though they rarely saw eye to eye on anything, Gov. “Alfalfa” Bill Murray went along with Roosevelt and declared a state bank holiday as well.
H.H. Champlin owned First National Bank of Enid. He declared his bank was sound and there was no need to close down, so he opened for business just as usual on March 6.
Murray telegraphed Champlin to say he would close and Champlin telegraphed back “no,” he would not close. So, Murray, not for the first time, called out the National Guard to shut down First National Bank of Enid. Eighteen militia men under the charge of Stephen J. England, captain of the local guard unit and professor at Phillips University, walked into the bank and shut it down.
On March 9, congress passed emergency legislation giving President Roosevelt new powers to confront the banking crisis. On March 10, the nation wide bank holiday ended.
Champlin’s bank opened as if nothing had happened, but he had become a local hero in the process.

Information provided by Cherokee Strip Regional Heritage Center.

No comments: