> I think there were a lot of problems, but most of them boil down to "heavy-handed government intervention in the markets". The Fed was very hands off in the

> I think there were a lot of problems, but most of them boil down to "heavy-handed government intervention in the markets". The Fed was very hands off in the early 1930s: > […] At the onset of the Great Depression in 1929–1930, the Fed maintained a “hands-off” approach, believing the economy simply needed to “wring out its excesses.” This is somewhat ironic in that Fed policy itself greatly contributed to the financial excesses of the 1920s. Nevertheless, the Fed failed to recognize the nature of the economy. > When the Great Depression hit in 1929, the Fed’s instinct was to do little and let the economy and markets correct. But the Fed seemed to have no sense of how big the credit bubble from the 1920s was. Consequently, from 1929–1933, the Fed remained committed to a tight monetary policy. Under the gold standard then in force, when the gold balances held by the government contracted, the money supply did so as well. Faced with the increasing economic turmoil, US businesses and the public at large trusted gold more than paper currency. Overseas investors, fearing a potential devaluation of the dollar, preferred gold too. This created a gold drain. As the Fed’s gold stocks declined, the United States unwittingly reduced credit in the economy. Over the 1929–1933 period, the US money supply contracted sharply, declining by roughly one third between 1929 and 1933, and the country experienced its worst ever downturn, with unemployment soaring to roughly 25%. * https://blogs.cfainstitute.org/investor/2015/09/17/the-ghost-of-1937-the-fed-stalls-on-rate-hike/ https://blogs.cfainstitute.org/investor/2015/09/17/the-ghost... It was the interventionist policies of new New Deal and its various spending and jobs programs that helped the recovery begin. As well as getting off the gold standard: * https://delong.typepad.com/delong_long_form/2013/10/the-great-depression-from-the-perspective-of-today-and-today-from-the-perspective-of-the-great-depression.html https://delong.typepad.com/delong_long_form/2013/10/the-grea... If you think things are bad with government intervention and regulation, you may wish to examine history about things before it became a thing: * https://en.wikipedia.org/wiki/Panic_of_1893 https://en.wikipedia.org/wiki/Panic_of_1893 * https://en.wikipedia.org/wiki/Panic_of_1896 https://en.wikipedia.org/wiki/Panic_of_1896 * https://en.wikipedia.org/wiki/Panic_of_1907 https://en.wikipedia.org/wiki/Panic_of_1907 IMHO the (US) financial system has been much more stable with more of a government / Fed hands-on approach. Certainly there were crashes (1987) and bubbles (1999), but that was more on the private sector side. At least one problem was due to not enough oversight: * https://en.wikipedia.org/wiki/Savings_and_loan_crisis https://en.wikipedia.org/wiki/Savings_and_loan_crisis