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First Bank of the US is chartered
Congress chartered the Bank of the United States in 1791 in an attempt to create a national bank that would stabilize the nation's economy and improve economic decision making of the United States Government. State governments opposed the bank, as it gave the federal government more power. In 1811, in a very close vote, it was decided the bank's charter would not be renewed. Afterwards, Stephan Girard purchased most of its stock as well as the building. -
Second Bank of the United States is chartered
The Second Bank of the United States was chartered by the Federal Government in another attempt to create a central national bank that would help regulate the economy and stabilize the national currency. The bank's charter extended from February 1816 to January 1836. -
United States issues Greenbacks during Civil War
The United States Federal Government first issued a national paper currency during the civil war, in July of 1861. There were two versions: Demand Notes, and United States Notes. Demand Notes were not legal tender, but could be used to pay customs duties. Demand Notes were printed from 1861-1862. This was the first bill with green printed on the back, and they bore the term "Greenbacks". United States Notes were the first currency unbacked by gold, issued from 1862-1865. -
National Banking Act of 1863
This was the first attempt to create a central national bank after the failures of the First and Second Banks of the United States. This act allowed national banks to be created, planned on establishing a national currency backed by securities held in other banks, and allowed the national government to sell war bonds and securities. National banks were chartered by the national government, and therefore had tighter regulations, while state banks received a high tax rate. -
Federal Reserve Act of 1913
This act established a federal reserve of currency, and gave the US government authority to issue Federal Reserve Notes(Dollars) as legal tender. The act was signed by Woodrow Wilson. -
Great Depressions impact on banking
It is debated whether the depression caused bank failures, or bank failures caused depression, but regardless of differing opinions, by 1933 11,000 of America's 25,000 banks had closed down. In 1929 hundreds of thousands of citizens attempted to withdraw all of their money from banks, which caused banks to collapse. -
Glass-Steagall Banking Act of 1933
The Glass-Steagall Banking Act established the Federal Deposit Insurance Corporation(FDIC). The FDIC ensures that if a bank that is FDIC protected fails, people will have their money reimbursed up to a certain dollar amount. -
1970's changes
In the 1970's, congress decided to relax restrictions on banking regulations. This allowed banks to have more freedom. -
1982 S&L Change
In 1982 congress began allowing S&L banks to make high risk loans and investments. Investments went up, but so did the rate of bank failure. The federal government had to reimburse 200 billion dollars to investors. Afterwards, the FDIC took over the S&L. -
Gramm-Leach Bliley Act of 1999
This legislature gave banks more control of their banking, insurance, and securities. It greatly reduced the regulations set in place during the Glass-Steagall Act, allowing normal commercial banks to act as investment banks.