Question

Another way the crash weakened the banks was that many banks themselves had taken depositor's money and invested it in the _______, hoping for higher returns than they could get by using the money for ______

Answer 1

Answer:

Another way the crash weakened the banks was that many banks themselves had taken depositor's money and invested it in the Stock Market, hoping for higher returns than they could get by using the money for Conventional Loans  

Explanation:

The core operation of the bank is to invest the money in the conventional loans issues. So if the banks are investing their money in the stock market in the hope of earning excess from the increase in the value of the shares and then the opposite happens. Then ofcourse this will weeken the banks financially as the investment of these banks in stock market will reflect huge losses due to the decrease in the value of shares they owned.