In 1932, after several years of continued devastation through policies of austerity and deflation, a desperate President Hoover turned to the proposal of a Reconstruction Finance Corporation to aid in saving the United States from collapse. The RFC was a powerful institution of credit, but one which Hoover failed to understand. Instead of building out of the collapse, Hoover threw money at the banks and the banks in turn threw that money into speculation, further devastating the nation.
With the 1933 inauguration of Franklin Roosevelt, this situation rapidly changed. Armed with the RFC, Roosevelt wielded the power of public credit to transform the United States.