Capra had become convinced that the mass-experience of watching a motion picture with an audience had the psychological effect in individual audience members of slowing down the pace of a film. A film that during shooting and then when viewed on a movieola editing device and on a small screen in a screening room among a few professionals that had seemed normally paced became sluggish when projected on the big screen. While this could have been the result of the projection process blowing up the actors to such large proportions, Capra ultimately believed it was the effect of mass psychology affecting crowds since he also noticed this "slowing down" phenomenon at ball games and at political conventions. Since American Madness dealt with crowds, he feared that the effect would be magnified.

He decided to boost the pace of the film, during the shooting. He did away with characters' entrances and exits that were a common part of cinematic "grammar" in the early 1930s, a survival of the "photoplays" days. Instead, he "jumped" characters in and out of scenes, and jettisoned the dissolves that were also part of cinematic grammar that typically ended scenes and indicated changes in time or locale so as not to make cutting between scenes seem choppy to the audience. Dialogue was deliberately overlapped, a radical innovation in the early talkies, when actors were instructed to let the other actor finish his or her lines completely before taking up their cue and beginning their own lines, in order to facilitate the editing of the sound-track. What he felt was his greatest innovation was to boost the pacing of the acting in the film by a third by making a scene that would normally play in one minute take only 40 seconds.

When all these innovations were combined in his final cut, it made the movie seemed normally paced on the big screen, though while shooting individual scenes, the pacing had seemed exaggerated. It also gave the film a sense of urgency that befitted the subject of a financial panic and a run on a bank. More importantly, it "kept audience attention riveted to the screen," as he said in his autobiography. Except for "mood pieces," Capra subsequently used these techniques in all his films, and he was amused by critics who commented on the "naturalness" of his direction.