Question

In what two ways did the federal reserve help cause the depression?

Answer 1

Not only did the Federal Reserve fail to prevent the Great Depression but it was primarily responsible for its length and severity. The Federal Reserve controls the money supply and would never exist in a true free market economy.

Step-by-step explanation:

If a bank is irresponsible and loses your money in the stock market, the Federal Reserve System can lend the bank money to prevent it from collapsing. ... People stopped regulating banks and banks became even more irresponsible. This is one of the factors contributing to the Great Depression. The Federal Reserve System was established to prevent the bank runs and bank failures that happened during the Great Depression. However, they made it worse. They were supposed to provide liquidity and instead they reduced liquidity.

Answer 2

Not only did the Federal Reserve fail to prevent the Great Depression but it was primarily responsible for its length and severity. The Federal Reserve controls the money supply and would never exist in a true free market economy.

Step-by-step explanation:

bc if u are in depression dont give up bc he or she is not worth it