United States Postal Savings System

")[8] Total assets in the postal system remained at about $200 million until the Great Depression, when many savings and loan associations (S&Ls) failed.

As more banks refused postal deposits because of the 2.25% (raised to 2.5% in 1934) interest requirement, the system increasingly invested in the only legal alternative, public debt, further constricting the money supply.

O'Hara and David Easley wrote that the inflexibility of the postal system inadvertently worsened the economy during the Depression, instead of stabilizing it as intended.

[9] Although this practice was initially 'not to be associated with criminology', the early 1950s Yours Truly, Johnny Dollar radio show suggested that in some instances, Postal Savings account fingerprints were used for positive identification in criminal cases.

According to a 2019 analysis, "the program was initially used by non-farming immigrant populations for short-term saving, then as a safe haven during the Great Depression, and finally as a long-term investment for the wealthy during the 1940s...

"[10] The system originally had a natural advantage over deposit-taking private banks because the deposits were always backed by "the full faith and credit of the United States Government."

However, because the establishment of the Federal Deposit Insurance Corporation gave a guarantee to depositors in private banks, the system lost its advantage in trust.