During the year of 1993 the United States Congress passed an act in an attempt to reorganize U.S banks. The act that they passed was the Glass-Steagall Act of 1993. The Glass-Steagall Act then established the Federal Deposit Insurance Corperation aslo known as FDIC.The Federal Deposit Insurance Corperation granted people federal insurance for individual bank accounts upto $5000. This inusred bank coustomers that their money was safe in that bank as long as they were FDIC insured.During the Great Depression nearly 4,000 banks closed permanently. People who had money in these banks lost every single penny they had invested in that bank. The Federal Deposit Insurance Corperation was a positive thing for people at this time. Although many had just lost quite possibly their whole life saving during the crash of the banks their money was now garuneteed up to $5000.The main reason for passing the Glass-Steagall Act of 1933 was to prohibit commercial banks from engaging in the investment buisness. The Glass-Steagall Act put an end to what people refered to as "improper bank activity". At this time commercial banks were taking great risks with the depositors money. Banking during this era had become sloppy and the objectives of banks had become unclear. Banks were taking huge risks in hopes of even bigger rewardsl.I think that the Glass- Steagall Act was a good idea but the FDIC was pointless at the time when created. The GSA did what was right for the people and outlawed the banks from investing there money in other places. The FDIC was worthless because people who lost money in the banks had lost all trust in them. Also there was no use in protecting peoples money in the banks because they lost all of there money when they crashed.
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