The failure of the Bank of the United States in December 1930 probably intensified the banking panic for each of the following reasons except that it proved that ___

Question

Quizplus · Accepted Answer

The failure of the Bank of the United States in December 1930 highlighted several issues, but it did not specifically prove that New York Banks could fail, as the Bank of the United States was not a central bank of the United States but rather a large commercial bank based in New York. The other options (A, B, and D) reflect broader concerns raised by its failure, including the potential inaction of the Federal Reserve as a lender of last resort, the vulnerability of big banks, and the implications for Wall Street banks. However, the failure itself was not a direct proof that New York Banks, as a category, could fail, since it was already understood that banks in New York or elsewhere could be at risk.

The Failure of the Bank of the United States in December