-
Agricultural America
At the time that the Declaration was signed, the United States was a largly agricultural society. People mostly farmed and were fairly self-sufficient. Food was abundant and the economy was doing somewhat well at the start of our nation. -
Period: to
US Economic Institutions Timeline
-
The Constitution
The US Constitution was adopted and as far as the economy was concerned, it established that the entire nation was a unified, or "common," market. It said that there were to be no tariffs or taxes on between states. The Constitution provided that the federal government could regulate commerce with other nations and among the states, and said that the gov could create and determine how much money was worth. It was a huge basis for the US economy. -
Nation's First Bank
Alexander Hamilton is the one that proposed that the nation should have a federal bank in order to stabilize and improve the nation's credit, and to improve how the United States handled their financial business within the new Constitution. Farmers feared that it would help the rich while hurting the poor. The bank was open for 20 years. -
Thomas Jefferson
Thomas Jefferson didn't like Hamilton's ideas on the economy. He wanted a more decentralized government. So when Jefferson was elected president, he allowed the First National Bank to close in 1811. -
Second Bank of the United States
After the War of 1812 it became apparent that the United States needed a National Bank. Consequently, the Second Bank of the United States was opened in 1816. It was needed because of large inflation after the war. Andrew Jackson allowed the bank's charter to run out in 1836. -
State Bank Notes
There was very little regulation on the bank notes that banks were able to give out. A combined 1600 state and private banks all gave out their own bank notes with over 30,00 different varieties of color and design. Due to these problems, bank notes were easily counterfeited which cause bank failures as well as circulation problems. -
The Civil War
The United States was nearing bankruptcy and was being pressured into financing the Civil War, Congress authorized the United States Treasury to issue paper money for the first time in the form of non-interest bearing Treasury Notes called Demand Notes. -
Greenbacks
Demand Notes were replaced by United States Notes. These were colectively called “greenbacks” because of the green tint they had in order to discourage photographic counterfeiting, They were last issued in 1971. The Secretary of the Treasury was empowered by Congress to have notes engraved and printed by private bank note companies. The notes were signed and covered with seals by six Treasury Department employees. -
The New Money
The design of U.S. currency incorporated a Treasury seal, the fine-line engraving necessary for the difficult-to-counterfeit intaglio printing, intricate geometric lathe work patterns, and distinctive cotton and linen paper with embedded red and blue fibers. -
A Busy Year: Gold and the Secret Service
Gold Certificates were issued by the Department of the Treasury against gold coin and bullion deposits. They circulated the economy until 1933. The Department of the Treasury established the United States Secret Service to control counterfeiting. Because at that time, one-third of all circulating currency was estimated to be counterfeit. -
National Bank Notes
National Bank Notes, which were backed by U.S. government securities, became predominant. By this time, 75 percent of bank deposits were held by nationally chartered banks. As State Bank Notes were replaced, the value of money, or currency, flatlined for a time. -
Transcontinental Railroad
This is the date that the railroad was completed. The railroad connected the east and the west. Was a huge boost economically because goods good now be transported great distances in less time. -
Silver
The Department of the Treasury was authorized to issue Silver Certificates in exchange for silver dollars. The last issue was in the Series 1957. -
Federal Reserve
After financial panics in 1893 and 1907, the Federal Reserve Act of 1913 was passed. It created the Federal Reserve System as the nation's central bank to regulate the flow of money and credit for economic stability and growth. Federal reserve notes became the only type of currency in the United States. -
Keeping it Consistent
Currency was reduced in size by 25 percent, and a consistent design was introduced with uniform portraits on the front and emblems and monuments on the back. -
Stock Market Crash
Economic activity had dropped significantly when the stock market crashed, leading us into an economic depression. This period of time is known as the Great Depression. The stock prices fell and people pulled money out of the system and caused it to become worse. -
The New Deal
Franklin D. Roosevelt created the New Deal as a way to restore the nations economy. It also created many of the institutions that are still in use today like the FDIC and the Social Security System. These keep our economy strong and more reliable. -
Safety
A security thread and microprinting were introduced to deter counterfeiting by advanced copiers and printers. The features first appeared in Series 1990 $100 bills. By Series 1993, the features appeared on all denominations except $1 and $2 bills. -
New Design
The U.S. Treasury introduced redesigned $5 and $10 bills to make counterfeiting more difficult. The new notes feature oversized pictures of Abraham Lincoln and Alexander Hamilton that are slightly off-center. Other anti-counterfeiting measures include watermarks that can be seen under a light, security threads that glow when exposed to ultraviolet light and tiny printing that’s visible with the help of a magnifying glass. The $100, $50 and the $20 bill underwent similar makeovers in 1996, 1997 a -
Homeland Security
Protecting the security of the dollar against counterfeiting takes its place side-by-side with other homeland security efforts, as the U.S. Secret Service is integrated into the new U.S. Department of Homeland Security.
