Franklin D Roosevelt: 'There was a general rush by a large portion of our population to turn bank deposits into currency or gold' First fireside chat - 1933

My friends:

I want to talk for a few minutes with the people of the United States about banking -- to talk with the comparatively few who understand the mechanics of banking, but more particularly with the overwhelming majority of you who use banks for the making of deposits and the drawing of checks.

I want to tell you what has been done in the last few days, and why it was done, and what the next steps are going to be. I recognize that the many proclamations from State capitols and from Washington, the legislation, the Treasury regulations, and so forth, couched for the most part in banking and legal terms, ought to be explained for the benefit of the average citizen. I owe this, in particular, because of the fortitude and the good temper with which everybody has accepted the inconvenience and hardships of the banking holiday. And I know that when you understand what we in Washington have been about, I shall continue to have your cooperation as fully as I have had your sympathy and your help during the past week.

First of all, let me state the simple fact that when you deposit money in a bank, the bank does not put the money into a safe deposit vault. It invests your money in many different forms of credit -- in bonds, in commercial paper, in mortgages and in many other kinds of loans. In other words, the bank puts your money to work to keep the wheels of industry and of agriculture turning around. A comparatively small part of the money that you put into the bank is kept in currency -- an amount which in normal times is wholly sufficient to cover the cash needs of the average citizen. In other words, the total amount of all the currency in the country is only a comparatively small proportion of the total deposits in all the banks of the country.

What, then, happened during the last few days of February and the first few days of March? Because of undermined confidence on the part of the public, there was a general rush by a large portion of our population to turn bank deposits into currency or gold -- a rush so great that the soundest banks couldn't get enough currency to meet the demand. The reason for this was that on the spur of the moment it was, of course, impossible to sell perfectly sound assets of a bank and convert them into cash, except at panic prices far below their real value. By the afternoon of March third, a week ago last Friday, scarcely a bank in the country was open to do business. Proclamations closing them, in whole or in part, had been issued by the Governors in almost all the states. It was then that I issued the proclamation providing for the national bank holiday, and this was the first step in the Government’s reconstruction of our financial and economic fabric.

The second step, last Thursday, was the legislation promptly and patriotically passed by the Congress confirming my proclamation and broadening my powers so that it became possible in view of the requirement of time to extend the holiday and lift the ban of that holiday gradually in the days to come. This law also gave authority to develop a program of rehabilitation of our banking facilities. And I want to tell our citizens in every part of the Nation that the national Congress -- Republicans and Democrats alike -- showed by this action a devotion to public welfare and a realization of the emergency and the necessity for speed that it is difficult to match in all our history.

The third stage has been the series of regulations permitting the banks to continue their functions to take care of the distribution of food and household necessities and the payment of payrolls.

This bank holiday, while resulting in many cases in great inconvenience, is affording us the opportunity to supply the currency necessary to meet the situation. Remember that no sound bank is a dollar worse off than it was when it closed its doors last week. Neither is any bank which may turn out not to be in a position for immediate opening. The new law allows the twelve Federal Reserve Banks to issue additional currency on good assets and thus the banks that reopen will be able to meet every legitimate call. The new currency is being sent out by the Bureau of Engraving and Printing in large volume to every part of the country. It is sound currency because it is backed by actual, good assets.

Another question you will ask is this: Why are all the banks not to be reopened at the same time? The answer is simple and I know you will understand it: Your Government does not intend that the history of the past few years shall be repeated. We do not want and will not have another epidemic of bank failures.

As a result, we start tomorrow, Monday, with the opening of banks in the twelve Federal Reserve Bank cities -- those banks, which on first examination by the Treasury, have already been found to be all right. That will be followed on Tuesday by the resumption of all other functions by banks already found to be sound in cities where there are recognized clearing houses. That means about two hundred and fifty cities of the United States. In other words, we are moving as fast as the mechanics of the situation will allow us.

On Wednesday and succeeding days, banks in smaller places all through the country will resume business, subject, of course, to the Government's physical ability to complete its survey It is necessary that the reopening of banks be extended over a period in order to permit the banks to make applications for the necessary loans, to obtain currency needed to meet their requirements, and to enable the Government to make common sense checkups.

Please let me make it clear to you that if your bank does not open the first day you are by no means justified in believing that it will not open. A bank that opens on one of the subsequent days is in exactly the same status as the bank that opens tomorrow.

I know that many people are worrying about State banks that are not members of the Federal Reserve System. There is no occasion for that worry. These banks can and will receive assistance from member banks and from the Reconstruction Finance Corporation. And, of course, they are under the immediate control of the State banking authorities. These State banks are following the same course as the National banks except that they get their licenses to resume business from the State authorities, and these authorities have been asked by the Secretary of the Treasury to permit their good banks to open up on the same schedule as the national banks. And so I am confident that the State Banking Departments will be as careful as the national Government in the policy relating to the opening of banks and will follow the same broad theory.

It is possible that when the banks resume a very few people who have not recovered from their fear may again begin withdrawals. Let me make it clear to you that the banks will take care of all needs, except, of course, the hysterical demands of hoarders, and it is my belief that hoarding during the past week has become an exceedingly unfashionable pastime in every part of our nation. It needs no prophet to tell you that when the people find that they can get their money -- that they can get it when they want it for all legitimate purposes -- the phantom of fear will soon be laid. People will again be glad to have their money where it will be safely taken care of and where they can use it conveniently at any time. I can assure you, my friends, that it is safer to keep your money in a reopened bank than it is to keep it under the mattress.

The success of our whole national program depends, of course, on the cooperation of the public -- on its intelligent support and its use of a reliable system.

Remember that the essential accomplishment of the new legislation is that it makes it possible for banks more readily to convert their assets into cash than was the case before. More liberal provision has been made for banks to borrow on these assets at the Reserve Banks and more liberal provision has also been made for issuing currency on the security of these good assets. This currency is not fiat currency. It is issued only on adequate security, and every good bank has an abundance of such security.

One more point before I close. There will be, of course, some banks unable to reopen without being reorganized. The new law allows the Government to assist in making these reorganizations quickly and effectively and even allows the Government to subscribe to at least a part of any new capital that may be required.

I hope you can see, my friends, from this essential recital of what your Government is doing that there is nothing complex, nothing radical in the process.

We have had a bad banking situation. Some of our bankers had shown themselves either incompetent or dishonest in their handling of the people’s funds. They had used the money entrusted to them in speculations and unwise loans. This was, of course, not true in the vast majority of our banks, but it was true in enough of them to shock the people of the United States, for a time, into a sense of insecurity and to put them into a frame of mind where they did not differentiate, but seemed to assume that the acts of a comparative few had tainted them all. And so it became the Government’s job to straighten out this situation and do it as quickly as possible. And that job is being performed.

I do not promise you that every bank will be reopened or that individual losses will not be suffered, but there will be no losses that possibly could be avoided; and there would have been more and greater losses had we continued to drift. I can even promise you salvation for some, at least, of the sorely presses banks. We shall be engaged not merely in reopening sound banks but in the creation of more sound banks through reorganization.

It has been wonderful to me to catch the note of confidence from all over the country. I can never be sufficiently grateful to the people for the loyal support that they have given me in their acceptance of the judgment that has dictated our course, even though all our processes may not have seemed clear to them.

After all, there is an element in the readjustment of our financial system more important than currency, more important than gold, and that is the confidence of the people themselves. Confidence and courage are the essentials of success in carrying out our plan. You people must have faith; you must not be stampeded by rumors or guesses. Let us unite in banishing fear. We have provided the machinery to restore our financial system, and it is up to you to support and make it work.

It is your problem, my friends, your problem no less than it is mine.

Together we cannot fail.

Source: https://www.americanrhetoric.com/speeches/...

Barack Obama: 'A common dream born of two continents', Democratic National Convention - 2004

27 July 2004, Boston, Massachusetts, USA

Thank you so much. Thank you. Thank you. Thank you so much. Thank you so much. Thank you. Thank you. Thank you, Dick Durbin. You make us all proud.

On behalf of the great state of Illinois, crossroads of a nation, Land of Lincoln, let me express my deepest gratitude for the privilege of addressing this convention.

Tonight is a particular honor for me because, let’s face it, my presence on this stage is pretty unlikely. My father was a foreign student, born and raised in a small village in Kenya. He grew up herding goats, went to school in a tin-roof shack. His father -- my grandfather -- was a cook, a domestic servant to the British.

But my grandfather had larger dreams for his son. Through hard work and perseverance my father got a scholarship to study in a magical place, America, that shone as a beacon of freedom and opportunity to so many who had come before.

While studying here, my father met my mother. She was born in a town on the other side of the world, in Kansas. Her father worked on oil rigs and farms through most of the Depression. The day after Pearl Harbor my grandfather signed up for duty; joined Patton’s army, marched across Europe. Back home, my grandmother raised a baby and went to work on a bomber assembly line. After the war, they studied on the G.I. Bill, bought a house through F.H.A., and later moved west all the way to Hawaii in search of opportunity.

And they, too, had big dreams for their daughter. A common dream, born of two continents.

My parents shared not only an improbable love, they shared an abiding faith in the possibilities of this nation. They would give me an African name, Barack, or ”blessed,” believing that in a tolerant America your name is no barrier to success. They imagined -- They imagined me going to the best schools in the land, even though they weren’t rich, because in a generous America you don’t have to be rich to achieve your potential.

They're both passed away now. And yet, I know that on this night they look down on me with great pride.

They stand here -- And I stand here today, grateful for the diversity of my heritage, aware that my parents’ dreams live on in my two precious daughters. I stand here knowing that my story is part of the larger American story, that I owe a debt to all of those who came before me, and that, in no other country on earth, is my story even possible.

Tonight, we gather to affirm the greatness of our Nation -- not because of the height of our skyscrapers, or the power of our military, or the size of our economy. Our pride is based on a very simple premise, summed up in a declaration made over two hundred years ago:

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain inalienable rights, that among these are Life, Liberty and the pursuit of Happiness.

That is the true genius of America, a faith -- a faith in simple dreams, an insistence on small miracles; that we can tuck in our children at night and know that they are fed and clothed and safe from harm; that we can say what we think, write what we think, without hearing a sudden knock on the door; that we can have an idea and start our own business without paying a bribe; that we can participate in the political process without fear of retribution, and that our votes will be counted -- at least most of the time.

This year, in this election we are called to reaffirm our values and our commitments, to hold them against a hard reality and see how we're measuring up to the legacy of our forbearers and the promise of future generations.

And fellow Americans, Democrats, Republicans, Independents, I say to you tonight: We have more work to do --  more work to do for the workers I met in Galesburg, Illinois, who are losing their union jobs at the Maytag plant that’s moving to Mexico, and now are having to compete with their own children for jobs that pay seven bucks an hour; more to do for the father that I met who was losing his job and choking back the tears, wondering how he would pay 4500 dollars a month for the drugs his son needs without the health benefits that he counted on; more to do for the young woman in East St. Louis, and thousands more like her, who has the grades, has the drive, has the will, but doesn’t have the money to go to college.

Now, don’t get me wrong. The people I meet -- in small towns and big cities, in diners and office parks -- they don’t expect government to solve all their problems. They know they have to work hard to get ahead,  and they want to. Go into the collar counties around Chicago, and people will tell you they don’t want their tax money wasted, by a welfare agency or by the Pentagon. Go in -- Go into any inner city neighborhood, and folks will tell you that government alone can’t teach our kids to learn; they know that parents have to teach, that children can’t achieve unless we raise their expectations and turn off the television sets and eradicate the slander that says a black youth with a book is acting white. They know those things.

People don’t expect -- People don't expect government to solve all their problems. But they sense, deep in their bones, that with just a slight change in priorities, we can make sure that every child in America has a decent shot at life, and that the doors of opportunity remain open to all.

They know we can do better. And they want that choice.

In this election, we offer that choice. Our Party has chosen a man to lead us who embodies the best this country has to offer. And that man is John Kerry.

John Kerry understands the ideals of community, faith, and service because they’ve defined his life. From his heroic service to Vietnam, to his years as a prosecutor and lieutenant governor, through two decades in the United States Senate, he's devoted himself to this country. Again and again, we’ve seen him make tough choices when easier ones were available.

His values and his record affirm what is best in us. John Kerry believes in an America where hard work is rewarded; so instead of offering tax breaks to companies shipping jobs overseas, he offers them to companies creating jobs here at home.

John Kerry believes in an America where all Americans can afford the same health coverage our politicians in Washington have for themselves.

John Kerry believes in energy independence, so we aren’t held hostage to the profits of oil companies, or the sabotage of foreign oil fields.

John Kerry believes in the Constitutional freedoms that have made our country the envy of the world, and he will never sacrifice our basic liberties, nor use faith as a wedge to divide us.

And John Kerry believes that in a dangerous world war must be an option sometimes, but it should never be the first option.

You know, a while back -- awhile back I met a young man named Shamus in a V.F.W. Hall in East Moline, Illinois. He was a good-looking kid -- six two, six three, clear eyed, with an easy smile. He told me he’d joined the Marines and was heading to Iraq the following week. And as I listened to him explain why he’d enlisted, the absolute faith he had in our country and its leaders, his devotion to duty and service, I thought this young man was all that any of us might ever hope for in a child.

But then I asked myself, "Are we serving Shamus as well as he is serving us?"

I thought of the 900 men and women -- sons and daughters, husbands and wives, friends and neighbors, who won’t be returning to their own hometowns. I thought of the families I’ve met who were struggling to get by without a loved one’s full income, or whose loved ones had returned with a limb missing or nerves shattered, but still lacked long-term health benefits because they were Reservists.

When we send our young men and women into harm’s way, we have a solemn obligation not to fudge the numbers or shade the truth about why they’re going, to care for their families while they’re gone, to tend to the soldiers upon their return, and to never ever go to war without enough troops to win the war, secure the peace, and earn the respect of the world.

Now -- Now let me be clear. Let me be clear. We have real enemies in the world. These enemies must be found. They must be pursued. And they must be defeated. John Kerry knows this. And just as Lieutenant Kerry did not hesitate to risk his life to protect the men who served with him in Vietnam, President Kerry will not hesitate one moment to use our military might to keep America safe and secure.

John Kerry believes in America. And he knows that it’s not enough for just some of us to prosper -- for alongside our famous individualism, there’s another ingredient in the American saga,  a belief that we’re all connected as one people. If there is a child on the south side of Chicago who can’t read, that matters to me, even if it’s not my child. If there is a senior citizen somewhere who can’t pay for their prescription drugs, and having to choose between medicine and the rent, that makes my life poorer, even if it’s not my grandparent. If there’s an Arab American family being rounded up without benefit of an attorney or due process, that threatens my civil liberties.

It is that fundamental belief -- It is that fundamental belief: I am my brother’s keeper. I am my sister’s keeper that makes this country work. It’s what allows us to pursue our individual dreams and yet still come together as one American family.

E pluribus unum: "Out of many, one."

Now even as we speak, there are those who are preparing to divide us -- the spin masters, the negative ad peddlers who embrace the politics of "anything goes." Well, I say to them tonight, there is not a liberal America and a conservative America -- there is the United States of America. There is not a Black America and a White America and Latino America and Asian America -- there’s the United States of America.

The pundits, the pundits like to slice-and-dice our country into red states and blue states; red states for Republicans, blue states for Democrats. But I’ve got news for them, too. We worship an "awesome God" in the blue states, and we don’t like federal agents poking around in our libraries in the red states. We coach Little League in the blue states and yes, we’ve got some gay friends in the red states. There are patriots who opposed the war in Iraq and there are patriots who supported the war in Iraq. We are one people, all of us pledging allegiance to the stars and stripes, all of us defending the United States of America.

In the end -- In the end -- In the end, that’s what this election is about. Do we participate in a politics of cynicism or do we participate in a politics of hope?

John Kerry calls on us to hope. John Edwards calls on us to hope.

I’m not talking about blind optimism here -- the almost willful ignorance that thinks unemployment will go away if we just don’t think about it, or the health care crisis will solve itself if we just ignore it. That’s not what I’m talking about. I’m talking about something more substantial. It’s the hope of slaves sitting around a fire singing freedom songs; the hope of immigrants setting out for distant shores; the hope of a young naval lieutenant bravely patrolling the Mekong Delta; the hope of a millworker’s son who dares to defy the odds; the hope of a skinny kid with a funny name who believes that America has a place for him, too.

Hope -- Hope in the face of difficulty. Hope in the face of uncertainty. The audacity of hope!

In the end, that is God’s greatest gift to us, the bedrock of this nation. A belief in things not seen. A belief that there are better days ahead.

I believe that we can give our middle class relief and provide working families with a road to opportunity.

I believe we can provide jobs to the jobless, homes to the homeless, and reclaim young people in cities across America from violence and despair.

I believe that we have a righteous wind at our backs and that as we stand on the crossroads of history, we can make the right choices, and meet the challenges that face us.

America! Tonight, if you feel the same energy that I do, if you feel the same urgency that I do, if you feel the same passion that I do, if you feel the same hopefulness that I do -- if we do what we must do, then I have no doubt that all across the country, from Florida to Oregon, from Washington to Maine, the people will rise up in November, and John Kerry will be sworn in as President, and John Edwards will be sworn in as Vice President, and this country will reclaim its promise, and out of this long political darkness a brighter day will come.

Thank you very much everybody. God bless you. Thank you.