Module 13 Lesson 2
1791 Bank of the US
The Bank of the US received a charter in 1791 from Congress; signed by President Washington
This bank collected fees and made payments on behalf of the federal government.
Bank went away because state banks opposed it; thought it gave too much power to national government
1816 Second Bank of the US
Second Bank of the US was chartered in 1816.
Failed because it didn’t regulate state banks or charter any other bank
State banks were issuing their own currency
1861 Civil War (printing currency)
1863 National Banking Act
Banks could have a state or federal charter (duel banking); encouraged development of a national currency backed by bank holdings of U.S. Treasury securities; The Act shaped today's national banking system and its support of a uniform U.S. banking policy.
1913 Federal Reserve Act
National bank; The Act was signed into law by President Woodrow Wilson.
1930’s Great Depression (regarding banking)
Great Depression caused banks to collapse
FDR declared a “bank holiday” where banks closed
Only allowed to reopen if they proved they were financially stable
1933 Glass-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; The United States and Japan exited the recession relatively early, but high unemployment would continue to affect other OECD nations through to at least 1985.
1999 Gramm-Leach-Bliley Act.
Allows banks to have more control over banking, insurance and securitiesCons: less competition, may form a universal bank; may lead to more sharing of information (reduction of privacy)