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45
The second wave of bank failures came in of . Several large international banks in and were failing. On top of this, Britain left the , which fueled panic. How did Britain's decision effect the US?
Spring/Summer of 1931
Austria and Germany
Gold standard
Britain was the model for a sound banking system, so when they stopped payments in gold for paper money, people began to worry. They hoarded gold, which decreased the amount of money in banks which in turn decreased M that led to greater decreases in P and Y.
Austria and Germany
Gold standard
Britain was the model for a sound banking system, so when they stopped payments in gold for paper money, people began to worry. They hoarded gold, which decreased the amount of money in banks which in turn decreased M that led to greater decreases in P and Y.
Flashcard info:
Author: savhighsmith
Main topic: Economics
Topic: History of Economics
School / Univ.: UGA
City: Athens
Published: 11.12.2010