Banking in the United States
The History
The Beginning of Our Banking System
The first bank the country had was the Bank of the US. It was chartered in 1791 by Congress under President Washington. It had typical functions, such as collecting fees and making payments for the federal government. The bank wasn't popular among state banks, which thought it gave the national government too much power. This is what caused the bank to fail.
Second Bank of the US
This was chartered in 1816. It did not regulate state banks or charter other banks, this lead to its failure.
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Currency during the Civil War
During the Civil War was the first time the federal government printed paper currency. http://htx1.com/wp-content/uploads/Civil-WAr-10a-front.jpg
1863 National Banking Act
Dual banking was introduced. State or Federal government could charter a bank. https://www.philadelphiafed.org/education/money-in-motion/treasure-trove/americas-ever-changing-money/_images/national-bank-note_1863.jpg
1913 Federal Reserve Act
Established a national bank.
Great Depression
During the Great Depression, banks collapsed and people lost their money. The "bank holiday" closed banks until they were financially stable again.
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Glass- Steagall Banking Act
The act established the Federal Deposit Insurance Corporation. Insuring that people would still have their money if the bank collapsed.
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The 1970's
Restrictions of banks were relaxed.
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1982
S&L banks made high risk loans and investments, which caused the banks to fail and the federal government had to give investors their money back, causing large national debt. http://images.wisegeek.com/us-money-bills.jpg
1999 Gramm-Leach-Billey Act
This gave banks more control over banking, insurance, and securities. This poses potential problems for people's privacy in banking.