Module 13 Lesson 2

Banking Industry

1791 Bank of the US and 1816 Second Bank of the US

The first bank of the United States was in 1791 signed by President Washington. The bank collected fees and made payments on behalf of the federal government. It was closed down because states opposed of it. Also because it gave to much power to the national government. The second bank of the United States was in 1816 and this one failed because it didn't regulate state banks or charter any other bank. State banks were making there own currency and the federal government didn't do anything about it until the civil war. They both failed until they made a decision about currency and came together.

Civil War (printing currency), 1863 National Banking Act

the civil war was when they finally started printing a currency. it was fought from 1861-1865 seven southern states declared there secession from the us and made the confederate states of america. they increased to have 11 states and claim 13 and also claim some western territories. in the national banking act of 1863, banks could have a state or federal charter (duel banking).The Act shaped today's national banking system and its support of a uniform U.S. banking policy.

1913 Federal Reserve Act, 1930’s Great Depression (regarding banking)

The Federal Reserve Act intended to establish a form of economic stability through the introduction of the central is one of the most influential laws concerning the U.S. financial system. The Great Depression was a severe world economic depressionin the decade preceding world war II. It also caused banks to collapse and President FDR declared a bank holiday where banks closed and only opened if they proved they were financially stable.

Glass-Steagall Banking Act, 1970’s (regarding banking), 1982 (regarding banking), and the 1999 Gramm-Leach-Bliley Act.

The Glass-Steagall Banking act established the Federal Deposit Insurance Corporation. Ensures that if a bank goes under, you still have your money. The Gramm-Leach-Biley Act repealed part of the Glass-Steagall Act, removing barriers in the market among banking companies,securities companies and insurance companies that prohibited any one institution from acting as any combination of an investment bank, a commercial bank, and an insurance company.