Plz help! Why were banks the focus of attention early in the First New Deal? The banks had been overlending to people and businesses, causing ripple effects throughout the economy when they could not pay out deposits or collect on loans.
The banks and their employees were the only groups thriving in the midst of the economic downturn and were seen as scapegoats for the widespread suffering of average people.
The banks themselves had caused the stock market crash by withdrawing their investments all at once on the advice of government officials and economic analysts.
The banks were seen as to blame for the economic downturn because throughout the previous decade they had strict and limited lending policies that stifled growth.