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1832 Bank Recharter Bill
The national bank charter faced renewal. President Andrew Jackson, rejected the renewal of the bank. Jackson set out to reduce the economic power, and went against the advice of congress committees and some of his cabinet members. Instead he placed federal deposits into pet banks. -
Election of 1832
This was the first election where candidates were nominated by national nominating conventions. Jackson ran against Clay in a heated election. His platform focused on getting rid of the national bank, while Clay promised to support it. Jackson was reelected by an overwhelming majority, and he was free to act on the bank issue. -
Jackson´s Veto
Jackson took advantage of his presidential power and vetoed the bank recharter bill. This caught the attention of his supporters and angered his enemies. Some thought he was abusing his executive power. -
Jackson Removes Federal Deposits
The removal of the federal deposits was the next step in Jackson´s campaign. Jackson began by taking nearly all the money from national reserves and distributing it to state "pet" banks. He thought that getting rid of the bank's money would cause it to collapse faster, and it did. The national bank collapsed at a rate that would lead the country into an economic crisis. -
Biddle´s Response
Nathaniel Biddle, president of the national bank, began taking actions to recharter the national bank. He spoke out against Jackson's harsh actions and gathered a large group of supporters. Congress voted to recharter the bank, but Jackson again vetoed. Biddle and his supporters claimed that Jackson was abusing his executive power. -
Speculative Boom
A speculative boom is the false notion that money is in abundance and the economy is growing. With federal money moved closer to home, people thought that they were becoming richer. -
Jackson´s Pet Bank
Pet banks were privately funded state banks where Jackson deposited federal money. He did this to make the national bank collapse, this also hurt the economy and caused national financial panic. -
Specie Circular
Another act created by Jackson, but carried out by president Van Buren who had taken office. This act required that land be purchased in gold and silver rather than paper money or banknotes. Jackson believed in paying traditionally for land. This led to a drastic decline in the value of paper money. Inflation greatly hurt the economy, and people became angry at Van Buren rather than Jackson. -
Crash of 1837
Inflation caused the fall of the national bank, and overspending led to economic recession. Prices of American goods fell, businesses went bankrupt, and state banks began to collapse without strong national support.
