Great Depression Hits Iowa Falls: Iowa Time Machine December 21, 1932

Iowa Time Machine ⏰: On December 21, 1932, the third bank in Iowa Falls failed as Iowa entered the extreme depths of the Great Depression. As corn fell to 8 cents per bushel, pork prices plummeted to 3 cents per pound, and beef reached five cents a pound, Iowans struggled to survive the most significant economic crisis in the country’s history.

Although the stock market crashed in 1929, hard times set in in 1926, when average input costs for equipment, seed, taxes, and other expenses crept below the breakeven point. From 1926 to 1930, the average farmer paid 35% of their income to try to grow a successful crop. By 1932, the average Iowa farmer paid 50% of their income by the end of harvest.

The first bank in Iowa Falls to falter closed in June of 1932, and a town-wide 10-day business holiday started on July 4 to help stabilize the financial situation in the Hardin County town. Locals attempted to band together, signing agreements not to draw down accounts by more than 10% per month to help ensure the banks' survival. However, by December, all three banks in town closed. For the next five months, the citizens of Iowa Falls didn’t have a local bank,

Nationally, over 9,000 banks closed during the Great Depression. In 1932 alone, weary Iowans withdrew assets from banks at a rate of 17%, leading to the failure of many institutions. Only with federal intervention in the form of the Glass-Steagall Act (which created the FDIC) and the Agricultural Adjustment Act in 1933 did the economic situation gradually begin to turn toward better days. #Iowa #History #OTD #Banking #GreatDepression