Which act was designed to control speculation and established the FDIC?

The Glass-Steagall Act, enacted in 1933, was a significant piece of legislation aimed at restoring stability to the financial system during the Great Depression. One of its main objectives was to establish regulations to control speculation and prevent excessive risk-taking in the banking sector. To achieve this, the Glass-Steagall Act introduced measures that separated commercial banking from investment banking, thereby reducing the conflicts of interest and financial speculation that had contributed to the stock market crash of 1929.

In addition to regulating banking practices, the Glass-Steagall Act also established the Federal Deposit Insurance Corporation (FDIC). The FDIC was created to provide deposit insurance to protect bank depositors' funds, thus enhancing public confidence in the banking system and reducing the likelihood of bank runs.

This act represented a pivotal shift in the regulatory landscape of the financial industry, aiming to ensure greater stability and protection for consumers in the face of economic uncertainty.