-
Currency in the Beginning
To finance the American Revolution, the Continental Congress printed the new nation's first paper money. They were issued in large quantities which led to inflation which rapidly accelerated as the war progressed. -
First attempt at Central Banking
The first Bank in the US was in Philadelphia established by Alexander Hamilton. It stabilized and improved the nations credit. -
The Free Banking Era
banks and uncharteered "free banks' took hold during this period, issuing theirown notes, redeemable in gold. banks began offering demand deposits to enhance commerce. resulted in the New York Clearinghouse Association being established and provided exchangable checks and settle accounts. -
National Banking Act
This created national banks which issued circulating notes that had to be backed by us government securities. this required taxation on state bank notes but not on national bank notes. -
The Federal Reseve System made
the Glass- Willis propsal was hotly debated, molded and reshaped. wehn president woodrow wilson signed the federal reserve act into law it stood as a classic examole of compromise- balanced the competing interests of private banks and populist sentiment. -
Fed Policy during the War
when war broke out, US banks continued to operate normally, thanks to emergency currency under the Aldrich- Vreeland Act of 1908. Through the federal policy the us aided the flow of traded goods to Europe, helping finance the war. -
The Great Depression
the stock market crashed and the nation fell into the worst depression ever. from 1930 to 1933 almost 10,000 banks failed and on March 6, 1933, President Franklin Delano Roosevelt declared a bank holiday that lasted 4 days. A handful of people blamed the fed for failing to understand that monetary economic could have kept the fed from pursuing policies that could have made it not as bad of a depression. -
Inflation and Disinflation
The 1970s saw inflation boom as producer and consumer prices rose, oil prices soared and the federal deficit more than doubled. Drastic action was necessary in order to break inflations straglehold on the us economy. -
Monetary Control Act
Marked the beginning of a period of modern banking industry refors. Banks began offering interest paying accounts and instruments to attract customers from brokerage firms. -
2000 & beyond
The federal reserve faces new challenges in the financial service industry: deregulation, technological advances in the payments system, and the move to a global economy.
