Reconstruction Finance Corporation - RFC

AAA

DEFINITION of 'Reconstruction Finance Corporation - RFC'

An agency created by the the U.S. government to aid the troubled banking sector in the years following the stock market crash of 1929. The Reconstruction Finance Corporation (RFC) was approved by Congress to begin business in 1932 with a mandate to make emergency loans to banks that were in danger of failing.

INVESTOPEDIA EXPLAINS 'Reconstruction Finance Corporation - RFC'

Although the RFC was intended to only stay in operation for 10 years following its inception, the agency lasted until 1957. During that time the RFC expanded its authority to include making loans to farmers, railroads, companies and even created eight subsidiaries to aid in the wartime effort during World War II.

RELATED TERMS
  1. Stock Market Crash Of 1929

    A severe downturn in equity prices that occurred in October of ...
  2. Subsidiary

    A company whose voting stock is more than 50% controlled by another ...
  3. Bailout

    A situation in which a business, individual or government offers ...
  4. Great Depression

    An economic recession that began on October 29, 1929, following ...
  5. Securities Act Of 1933

    A federal piece of legislation enacted as a result of the market ...
  6. Smart Traveler Enrollment Program

    A service of the U.S. Department of State that lets U.S. citizens ...
RELATED FAQS
  1. Can the Efficient Market Hypothesis explain economic bubbles?

    The efficient market hypothesis (EMH) cannot explain economic bubbles because, strictly speaking, the EMH would argue that ... Read Full Answer >>
  2. What can cause the rate of return to be negative?

    Several factors can cause an investment to have a negative rate of return. Poor performance of a company or companies, turmoil ... Read Full Answer >>
  3. What are some examples of the law of demand in real markets?

    The law of demand posits a negative relationship between the price of a good and quantity demanded if all other factors are ... Read Full Answer >>
  4. What role did junk bonds play in the financial crisis of 2007-08?

    Junk bonds were the at heart of the financial crisis of 2007-2008. Toxic assets related to the subprime housing market pushed ... Read Full Answer >>
  5. How important are fleet sales to an automaker's business?

    Fleet sales have been turning much more profitable with the recovery of the auto industry since the financial crisis of 2 ... Read Full Answer >>
  6. What role did securitization play in the U.S. subprime mortgage crisis?

    The securitization of subprime mortgages into mortgage-backed securities (MBS) and collateralized debt obligations (CDOs) ... Read Full Answer >>
Related Articles
  1. Insurance

    Top 6 U.S. Government Financial Bailouts

    U.S. bailouts date all the way back to 1792. Learn how the biggest ones affected the economy.
  2. Insurance

    A Review Of Past Recessions

    Here we look at the biggest economic declines in the U.S. since the Great Depression.
  3. Personal Finance

    The Crash Of 1929 - Could It Happen Again?

    Learn about the series of events that triggered the Great Depression.
  4. Retirement

    The History Of The FDIC

    Find out why this corporation was developed and how it protects depositors from bank failure.
  5. Economics

    What Caused The Great Depression?

    Learn how government actions may have contributed to this major economic downturn.
  6. Personal Finance

    Recession And Depression: They Aren't So Bad

    Financial downturns are part of the economic cycle and may have important long-term benefits.
  7. Economics

    Understanding Subordinated Debt

    A loan or security that ranks below other loans or securities with regard to claims on assets or earnings.
  8. Investing

    The Labor Market Recovery’s Missing Ingredient

    Job creation is running at the fastest pace since the 90s, and there is some evidence that wage growth is finally starting to accelerate, albeit modestly.
  9. Mutual Funds & ETFs

    6 ETFs to Fight Your Recession Jitters

    Are you worried about a recession? If so, consider these 6 ETFs.
  10. Economics

    The Field So Far: US 2016 Presidential Candidates

    Over the past several months, there has been a lot of speculation as to who will make a run at the Republican and Democratic nominations.

You May Also Like

Hot Definitions
  1. Wash Trading

    The process of buying shares of a company through one broker while selling shares through a different broker. Wash trading ...
  2. Fixed-Income Arbitrage

    An investment strategy that attempts to profit from arbitrage opportunities in interest rate securities. When using a fixed-income ...
  3. Venture-Capital-Backed IPO

    The selling to the public of shares in a company that has previously been funded primarily by private investors. The alternative ...
  4. Merger Arbitrage

    A hedge fund strategy in which the stocks of two merging companies are simultaneously bought and sold to create a riskless ...
  5. Market Failure

    An economic term that encompasses a situation where, in any given market, the quantity of a product demanded by consumers ...
  6. Unsystematic Risk

    Company or industry specific risk that is inherent in each investment. The amount of unsystematic risk can be reduced through ...
Trading Center