What term describes FDR's action of closing all banks for a period during the early 1930s?

What term describes FDR's action of closing all banks for a period during the early 1930s?

• A. Emergency Banking Act
• B. Banking Holiday
• C. Bank Run
• D. Bank Freeze

Answer: (B)

A banking holiday describes this action. It’s a deliberate nationwide pause on bank operations, used to stop runs on banks and buy time to stabilize the system. In early 1933, with confidence severely eroded and many banks at risk, President Roosevelt closed all banks for several days. This pause allowed inspectors to determine which banks were solvent and to lay the groundwork for reforms, culminating in banks reopening under new safeguards after the Emergency Banking Act was passed. The Emergency Banking Act is the subsequent law, not the action of closing the banks. A bank run refers to the panic that the holiday aimed to curb, and a bank freeze isn’t the historical term for this event.

A banking holiday describes this action. It’s a deliberate nationwide pause on bank operations, used to stop runs on banks and buy time to stabilize the system. In early 1933, with confidence severely eroded and many banks at risk, President Roosevelt closed all banks for several days. This pause allowed inspectors to determine which banks were solvent and to lay the groundwork for reforms, culminating in banks reopening under new safeguards after the Emergency Banking Act was passed. The Emergency Banking Act is the subsequent law, not the action of closing the banks. A bank run refers to the panic that the holiday aimed to curb, and a bank freeze isn’t the historical term for this event.