The Banking Industry
1791 Bank of the US
1816 Second Bank of the US
Failed because it didn’t regulate state banks or charter any other bank the State banks were also issuing their own currency
Civil War
1863 National Banking Act
1913 Federal Reserve Act
1930’s Great Depression (regarding banking)
FDR declared a “bank holiday” where banks closed. Only allowed to reopen if they proved they were financially stable
Steagall Banking Act
Established the Federal Deposit Insurance Corporation. Ensures that if a bank goes under, you still have your money
1970’s (regarding banking)
1982 (regarding banking)
Congress allows S&L banks to make high risk loans and investments. Investments went bad. Banks failed. Federal government had to give investors their money back. Federal government debt: $200 billion and The FDIC took over the S&L
1999 Gramm-Leach-Bliley Act.
Allows banks to have more control over banking, insurance and securities
Cons: less competition, may form a universal bank; may lead to more sharing of information (reduction of privacy)