congress vows new effort , page-8

very true mad market In 1929 the Fed's attitude was to let the banks fail. Repeated failures, however, caused investors to lose faith in the banking system. Withdrawal of deposits forced banks to withdraw credit from borrowers. Borrowers, forced to liquidate assets, drove down asset prices. This in turn set off another round of bank failures. A downward spiral commenced, with waves of bank failures, collapsing asset prices and rapid contraction of demand and production. The Great Depression lasted almost ten years