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In Ancient Egypt, stores of grain were held by individuals in a central location and debts were paid in quantities of grain.
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Italians bankers made loans to finance the wars, international trade, and exploration that characterized the era.
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By the 18th century, goldsmiths, artisans who make items out of gold began holding valuable objects for clients. In exchange, they would issue receipts stating the quality and quantity of the objects being held for the client.
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Before the American Revolution, banks in the true sense of the word did not exist in the colonies. Europeans wampum in early trading encounters with the native peoples.
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By 1750, every colony had issued it's own fiat currency.
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The Bank of North America was founded to finance the Revolutionary War. The Bank of America was able to raise money to fund the war by issuing notes.
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The First Bank of the United States was created in 1791 as the new government's central bank.
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A national currency was set up by Congress. All banks now had to hold gold and silver that could be exchanged for currency. It helped to control the economy.
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J.P. Morgan and Company emerged at the head of the merchant banks during the late 1800s, going directly to places like London.
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The Second Bank of the United States was established in 1816. Opponents of the bank made sure its 20-year charter was not renewed. For the next 26 years, there were no federal laws governing banking operations.
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The collapse in shares of a copper trust set off a panic that had people rushing to pull their money out of banks and investments, which caused shares to plummet.
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During this period, merchant banks; like Goldman and Sachs, Kuhn, Loeb, and J.P Morgan and Comapny, parlayed their international connections into both political and financial power.
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World War II may have saved the banking industry from complete destruction. WWII, and the industriousness it generated, lifted the American and world economy back out of the downward spiral.
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Federal Reserve Sets Off New “Bust” by Making Loans and Adjustable Rate Mortgages More Expensive, Raising Fed Fund Rates to 5.25%
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The financial crisis impacted people around the world – millions lost their homes, jobs, and retirement funds. Many of the smaller banks were absorbed by others, which allowed the biggest banks to further consolidate wealth and eliminate competition.
