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1791 Bank of the US
President Washington signed the charter from congress making the first bank of the US. The bank collected fees and made payments on behalf of the federal government. Unfortunately the bank was so opposed by the states because they thought it gave too much power to the national government that it went away. -
Second Bank of the US
The second Bank of the US was chartered in 1816 to be an improvement from the first bank of the US but failed because it did not regulate state banks or charter any other banks. -
Civil War
Up until this point states were printing their own currency, Both sides started making paper money in 1861. North had “green” backs and the south had “blue” backs. They were called demand notes and were available in $5, $10 and $20. -
National Banking Act
Was a law that created private banks to make national currency. and Banks could have a state or a federal charter. This act influenced the banking system today -
Federal Reserve Act
Created the National Bank and was intended to establish a form of economic stability. How they ensured stability in the banks was by giving 12 Federal Reserve banks the ability to print money. -
Great Depression
When the Great Depression came around it caused the banks to collapse. President Franklin Roosevelt declared a “bank holiday” where banks closed and were only allowed to reopen if they could prove that they were financially stable. -
Glass-Steagall Banking Act
This act established the Federal Deposit Insurance Corporation and ensured that if a bank goes under, the people invested in that bank would still have their money. (the picture is of roosevelt signing the act) -
regarding banking
Congress relaxed the restriction on banks. -
1982 banking
Congress allowed savings and loan banks to now make high risk loans and investments but as a result investments went bad, banks failed, the federal government had to give investor’s money back which caused them to be in over $200 billion debt, so the FDIC took over the S&L. -
Gramm-Leach-Bliley Act
This allowed the banks to have more control over their banking, insurance and securities, but it also meant less competition, may form a universal bank and may lead to more sharing of information which meant a reduction of privacy.
