Why Did FDR’s Bank HolidaySucceed?

[...]This article demonstrates that the Bank Holiday that beganon March 6, 1933, marked the end of an old regime, and theFireside Chat a week later inaugurated a new one. TheEmergency Banking Act of 1933, passed by Congress onMarch 9—combined with the Federal Reserve’s commitmentto supply unlimited amounts of currency to reopened banks created de facto 100 percent deposit insurance. Moreover, theevidence shows that people recognized this guarantee and, as aresult, believed the President on March 12, 1933, when he saidthat the reopened banks would be safer than the proverbial“money under the mattress.” Confirmation of the turnaroundin expectations came in two parts: the Dow Jones IndustrialAverage rose by a statistically significant 15.34 percent onMarch 15, 1933 (taking into account the two-week trading haltduring the Bank Holiday), and by the end of the month, thepublic had returned to the banks two-thirds of the currencyhoarded since the onset of the panic.[...]