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1791 Bank of the US
The first bank of America was an idea proposed by Alexander Hamilton. It was used to store the government's money and was a productive development but many people didn't like the idea so the charter was not renewed in 1811. It displayed mercantilism which offended the Jeffersonians because they favored agrarian ideas. They prevented the bank from staying open past 1811. -
1816 Second Bank of the US
The Second Bank of the US was chartered because the War of 1812 had left the United States of America in overwhelming debt. Soon an argument broke out between the bank owner, Nicholas Biddle, and Andrew Jackson. Jackson felt that the bank was a threat to the republic. More citizens were on Biddle's side and signed in favor of the bank. Almost 30 years later, President Tyler vetoed a bill re-instating the bank. This caused a revolt so President Tyler improved security and still closed the bank. -
Civil War (printing currency)
During the Civil War, "greenback" or paper dollars were the new currency in the United States. It was in with the paper and out with the coins. This took half a century and the bank circulated more paper money than coin money causing them to be worth less. The United states printed out $400 million dollars in "greenbacks" to pay of their debts(private and personal). The paper money was not exchangeable for gold or silver so other countries saw them as worthless. -
1863 National Bank Act
The National Bank Act was made to establish national currency. This was also a way to solve financial issues during the Civil War. There were no taxes at the time that could help with the costly war. It was organized in January of 1863. Thaddeus Stephens,a congressman from Pennsylvania opposed it but Secretary of Treasury, Salmon Chase promoted it. This act did not fix the United States' financial issues and was amended in 1864. -
1913 Federal Reserve Act
The Federal Reserve Act was signed by President Wilson and gave the Federal Reserve Banks the write to print money. They could also adjust the discount rate and buy or sell US treasuries. There are twelve Federal Reserve banks. They are located in Boston, New York, Dallas, Philadelphia, Kansas City, Cleveland, Richmond, St. Louis, Chicago, Atlanta, Minneapolis, and San Francisco. -
1930’s Great Depression (regarding banking)
In the 1920's each town in America had a bank for their citizens. They loaned money to businesses and farmers. When the Great Depression started, farmers had less money to spend so the banks started to close. In the 1930s, 9,000 banks were forced to close because of the economic crisis. By the time 1933 came around, $140 billion vanished because of unsuccessful banks. There was not anything like deposit insurance in the '30s so many people lost their life savings in the Great Depression. -
Glass-Steagall Banking Act
On June 16, 1933 President Roosevelt signed this making it a law that separated commercial banking and investment banking. This helped the banks reconstruct themselves after the banks tried to pay the money they lost when the stock market crashed in 1929. They only gave bank members ten cents for every dollar they had deposited. This was repealed in 1999 by President Bush. -
1970’s (regarding banking)
In the 1970s unemployment and inflation were result of a banking crisis. The banking crisis started because of the recession that began when President Johnson was in office. His spending in the Vietnam war created a recession. President Nixon took office after Johnson and was left to solve the crisis. -
1982 (regarding banking)
In June of 1981, a recession started that had been the worst since the Great Depression. This was caused by monetary policies to battle inflation. When Paul Volker became chairman of the Fed, he focused on money supply instead of interest rates. Volker's endeavor to control the inflation rate and bring it down failed at first but by 1982, his determination helped the United States to lower their inflation rate to five percent. -
1999 Gramm-Leach-Bliley Act
In 1999, the bank system was sued for sharing private information with third-parties. The act was implemented to prevent personal information from being shared by requiring financial institutions to give individuals privacy notices regarding their information sharing policies. There are three parts, the safeguard rule, the financial privacy rule, and the pretexting provisions.
