In his book "The Ascent of Money: A Financial History of the World," Niall Ferguson discusses the vulnerabilities of under-capitalized banks in America, which often led to financial instability and crises. These issues were particularly prominent during the Great Depression, a period marked by severe economic turmoil and widespread banking failures.

Ferguson points out that the inadequacy of banks' capital contributed to regular financial panics, reflecting a systemic weakness in the banking sector. The situation was made worse by the fact that the monetary authority at the time was relatively new and ill-equipped to handle such a significant crisis, further complicating the already precarious economic landscape.