[1] The original act was sponsored by Hoover in an attempt to stop the downward spiral of crop prices by seeking to buy, sell and store agricultural surpluses or by generously lending money to farm organizations.

Money was lent out to the farmers in order to buy seed and food for the livestock, which was especially important since there had previously been a drought in the Democratic South.

Overall, the deflation could not be countered because of a massive fault in the bill: there was no production limit.

The funds appropriated were eventually exhausted and the losses of the farmers kept rising.

1 legislation was passed by the 71st Congressional session and enacted by the 31st President of the United States Herbert Hoover on June 15, 1929.