Just a question, where would the Great Depression have fallen into all of this? I don't remember it's exact causes...did World War I have a major effect on it? I'm wondering what would have happened if this alternate timeline you mentioned happened - would the effects of the Depression be felt more, or would it not have happened at all?
This was already answered - though somewhat erroneously. Yes, the Great Depression probably still would've happened, because the war and its effect had no direct relation to it. It was caused by our own stupidity.

Basically, banks give out loans for business investments, right? But these are restricted by the free market economy - if a lot of investments hit it off, a lot of money comes in, the loans are repaid in full with interest, and more money can be given out. However, if the loans don't do so well, the money comes in slower, interests rates on the loans raise, and less are given out. The government wanted a way to keep interest rates down and have more loans in order to increase business investments, which would increase production, which would boost the economy. So the government started the Federal Reserve, which pooled all the banks' money together, and then the banks were told to accept any and all loans, and not worry about how much money was left. Because before, banks were also restricted by how much money they physically possessed - now they weren't.

The upshot is that all the banks combined loaned out more money than actually existed, since there was very few, if any, limits on credit. With businesses "booming," more people invested their fake money in the stock market, which boomed as well. People made fortunes - on paper, though a lot of the money never actually existed. An economy based on the equivalent of Monopoly money can't last for long, as the sudden collapse of Wall Street and the subsequent Great Depression showed.

At least, that's been the general idea of that my reading on this subject has led to.